Zoho Chief Scientist Sridhar Vembu shared a message directed at the company's workforce on Tuesday. In a social media post, Vembu noted that accelerating investment in AI technology has introduced uncertainty around the long-term outlook for jobs in the software industry.

Vembu indicated that geopolitical headwinds are clouding the road ahead for the software division, while AI-driven demand is pushing operational expenditure higher. Server costs alone have quadrupled, and the broader pattern of AI-related consumption is placing pressure on a cost base the company is actively working to reduce.

In a post on X, Vembu disclosed that the company had trimmed its marketing expenditure and that no salary increases would be forthcoming that year, pointing also to a difficult geopolitical environment as an added pressure. Staff members received notice that the annual pay rise would not be taking place.

Vembu expressed regret over the situation and noted that the company intends to protect jobs where possible, though the broader market for software roles faces an unclear period ahead. He indicated that the company would make every effort to prevent widespread job cuts, while noting that the broader software employment market faces an uncertain period ahead.

The organisation's headcount has held steady for the past year and a half, with no net additions to staff during that period. No breakdown was offered on how many staff members the pay decision affected, nor on the total spending Zoho has directed toward AI-related work.

A staff communication from Vembu noted that while the company's revenue was still expanding at 12 percent, new business and customer intake had slowed beyond what management had anticipated during September. In the same message, Vembu told employees that no compensation review or annual appraisal would take place that year, expressing that he did not wish to take their commitment for granted and that he felt he had fallen short of what they deserved.

Vembu noted that the company is working through how to reshape its direction and restore growth, while also pointing out that a portion of customers have been moving away from Zoho's software in favour of AI-generated alternatives produced through vibe coding. Vibe coding allows developers to describe what they want in plain language, with an AI system handling the actual code construction rather than writing it line by line.

Vembu's publicly expressed position was that engineers deploying these tools bear full responsibility for the underlying code and are required to understand it thoroughly. He disclosed that his attention is currently focused on charting a path for Zoho to reshape its direction and revive its expansion trajectory.