OpenText bought Micro Focus for $5.8B — and has cut ~5% of staff every year since.

On 31 January 2023 OpenText, the Waterloo, Ontario software group, closed its acquisition of Micro Focus for about $5.8 billion, a deal that bundled in Micro Focus's cash and debt and made OpenText one of the largest enterprise-software companies in the world. Buying a rival that size is a multi-year task: the two product lines, workforces and cost bases have to be merged. OpenText's name for that task is a three-year "business optimization programme."

The programme has run, above all, on headcount. Chief executive Mark Barrenechea kicked it off in 2024 by cutting 1,200 employees; in May 2025 the company cut another 1,600 jobs; and in early 2026 roughly 880 more went. That is about 5 percent of the workforce removed every year for three years — a cadence employees have taken to calling a "yearly spring cleaning." Barrenechea told staff that embracing AI was a "number one priority and baseline expectation," framing the cuts as a pivot toward AI, cloud and security rather than mere cost-cutting.

The promised payoff is large: OpenText has said the optimisation will generate annual savings of roughly $490 million to $550 million. The recurring cuts, though, are the tell. A company that must reduce its staff by 5 percent every year is not fixing a one-time overlap from an acquisition; it is running restructuring as a standing operation. The acquisition bought revenue and scale; the optimization is the long, repeated bill for digesting it.

The decision error sits one layer back from the layoffs. Growth by large acquisition lets a company buy revenue quickly, but the integration cost — the redundant roles, the overlapping tools, the debt it took on — arrives in instalments over years. OpenText's annual 5 percent cuts are those instalments. The lesson is not that acquisitions fail; it is that the price quoted at closing is not the whole price, and a workforce cut every spring is a sign the real one is still being paid.