Dropbox, a California technology company known for its file hosting services, announced that it has cut its global workforce by about 20 percent, or 528 employees, citing a decrease in demand and underperformance.

The San Francisco company made the announcement in an email from CEO Drew Houston to all employees, published on its blog on Oct. 30.

“We continue to see softening demand and macro headwinds in our core business,” Houston wrote.

External factors are only part of the story. Houston said that the company would be scaling back in areas where it had “over-invested” or had been “underperforming.”

In the email, Houston said that he took full responsibility for the layoffs, and that the company was creating a “flatter, more efficient” structure.

“[I]n some parts of the business, we’re still not delivering at the level our customers deserve or performing in line with industry peers,” Houston said.

He noted the need to divert resources to certain Dropbox products, including Dash, which offers AI search capability.

“This market is moving fast and investors are pouring hundreds of millions of dollars into this space,” Houston said.

The company is eliminating workers, who are referred to as “Dropboxers” internally, from its managerial levels.

“We’ve heard from many of you that our organizational structure has become overly complex, with excess layers of management slowing us down,” he said, addressing the company’s employees.

The company, whose 2024 second-quarter revenue climbed to $634.5 million, also cut 500 workers in April 2023. Dropbox share prices are down nearly 3 percent year-to-date and 21 percent from its February high.

Dropbox joins the ranks of other California tech companies that cut staff recently.

Meta said in October that it laid off some employees, including staff at WhatsApp and Instagram, to realign its resources with its goals, according to an Associated Press report. The company didn’t disclose how many employees it had cut.

The Bay Area freelance platform Upwork announced a 21 percent staff cutback on Oct. 24, and the San Francisco cryptocurrency exchange Kraken announced on Oct. 30 a workforce cutback of 15 percent.