Zoho founder Sridhar Vembu is facing criticism on social media after announcing that the company will suspend its usual annual salary increases this year, just days after urging Indian technology workers facing US immigration uncertainty to return to India and build businesses at home.
The controversy centres on the timing of Vembu’s two messages. His appeal to non-resident Indians came amid reports that the US administration had suspended green-card processing involving eight major technology companies, raising concerns among Indian professionals pursuing permanent residency. Four days later, Vembu disclosed that Zoho was cutting costs and would not provide its usual pay increases to employees this year.
Vembu attributed the decision to rising artificial intelligence-related expenses, higher server prices and an uncertain geopolitical environment. He said Zoho was cutting its marketing budget and trying to avoid mass layoffs, adding that the company had not increased its employee count for 18 months.
The announcement prompted some social media users to question whether India could readily offer returning professionals the employment opportunities and financial security they might lose by leaving established jobs in the United States.
“If Zoho itself has been struggling with the business outlook for 18 months, hasn’t increased headcount, and is unable to offer regular salary hikes, how easy is it going to be for returning NRIs to find opportunities and build here?” one user asked.
The user argued that patriotism alone could not substitute for a strong business environment, access to capital, customers and sustainable employment opportunities.
AI Costs and Uncertain Software Outlook
Explaining the appraisal freeze, Vembu said the software industry’s outlook had become uncertain as AI adoption increased operating expenses.
“The business outlook for software is uncertain and AI has raised costs dramatically with a) massive 4-fold increase in server prices which we need for data centers b) AI usage increasing rapidly, leading to much higher expenses, which we are trying to control,” he said.
He also cited the challenging geopolitical backdrop and said Zoho had reduced marketing expenditure.
“We have also told our employees that we cannot have our usual pay increase this year. I have apologized for not being able to avoid this. We will work hard to avoid mass layoffs but the outlook for software jobs in general is grim,” Vembu said.
He described the company as being in the middle of a reinvention, adding that the next three to five years would determine how successful that process proved to be.
“Please pray for us,” he wrote, a remark that also attracted criticism online.
However, other users defended Vembu, arguing that openly acknowledging business pressures was preferable to concealing them. One commenter praised him for discussing the difficulties facing the company and questioned whether critics understood the challenges involved in running a business.
The reactions highlight the tension between employees’ expectations of annual pay increases and the financial decisions companies make when costs rise or growth becomes uncertain.
‘What Is the Alternative? Beg Them to Allow Us to Stay?’
Vembu responded to criticism of his appeal to returning Indians by arguing that professionals should not assume they can remain in another country indefinitely if its immigration policies change.
“When another country tells you to go home, you come home. What is the alternative? Beg them to allow us to stay? Stay illegally?” he said.
He added that India offered numerous opportunities to build businesses and create value, even if the software industry became saturated or underwent major changes.
His response reframed the debate around India’s capacity to provide opportunities for returning professionals rather than Zoho’s immediate compensation decision.
The two issues, however, are related but distinct. A company can face genuine cost pressures while a country can still offer opportunities for entrepreneurs and skilled workers. Equally, an appeal to return home does not establish that suitable jobs, competitive salaries or funding will be available to everyone affected by immigration restrictions.
For Indian professionals weighing a return, the practical considerations include employment prospects, savings, family responsibilities, immigration status and the long-term value of overseas residency.
Vembu’s comments have brought those questions into sharper focus. His appraisal announcement concerns Zoho’s employees and business outlook; the wider debate concerns whether India’s technology sector can create enough sustainable opportunities for professionals who may be compelled or choose to return.
The episode also illustrates how the rapid adoption of AI is reshaping the technology industry’s cost structures and employment expectations, even as companies encourage innovation and reinvention.