WiseTech Global (ASX:WTC) This Is Not an “AI Jobs Bomb”, It’s M&A Synergies

The Layoffs Are Integration, Not AI Panic

Coming across coverage of WiseTech this reporting season, we have seen a lot of dramatic phrasing such as “first AI jobs bomb,” which frames the situation as if this is purely an AI-driven wave of replacement.

In our view, those headlines are far more attention-grabbing than they are reflective of what is actually happening.

When you look at most mergers and acquisitions, the core objective is usually the same. The acquirer brings a business into its own platform, integrates operations, removes duplication, and improves operating leverage over time. That is the normal playbook, and we think that is the more accurate lens to use here.

e2open was a high revenue business, but it was also operationally inefficient. It came with a much larger workforce, with total employee headcount estimated at around 3,700 to 3,900 as of early 2026. That helps explain why WiseTech’s gross margin fell to 77% and why the G&A line increased so sharply. The acquisition added scale, but it also added a heavier and less efficient cost base.

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The Real Story Is Cost Base Normalisation

“e2open has a higher proportion of professional services revenue and higher headcount in cost of revenues, which structurally dilutes group margin when consolidated.”

For WiseTech, the key point is that it does not need that full employee footprint over the long term. The company already has a strong and well-established supply chain software platform. So as integration progresses, management’s job is to retain the parts of e2open that strengthen the product suite, while removing the duplicated costs and roles that are no longer necessary inside the combined business.

Management has already said it achieved its US$50m annualised e2open cost synergy target early, and the next phase of integration runs through 2H26 into FY27. That next phase includes material role reductions across product, development, and customer service.

Headcount Cuts Are the Synergy Curve in Action

That is why we do not think headlines like “AI sends shockwaves” really capture the full picture. Yes, AI will absolutely play a role over time. Better automation, more intelligent workflows, and improved software integration will reduce the need for some manual work and certain coding functions.

But in this case, we think the more important driver is integration discipline, not just AI disruption. WiseTech is cutting staff it simply does not need because e2open is being used to fill product gaps and broaden the value proposition of an already established platform.

So the real story here is less about a sudden AI-led labour shock and more about WiseTech doing what disciplined acquirers are supposed to do: absorb the useful parts of the acquisition, simplify the cost base, and position the combined business for stronger operating leverage over time.