Feel bad for those guys, layoffs before the holidays always suck. Adobe is about the only large company out there that I've come to appreciate. They make good products, but more importantly have good people willing to communicate with it's users. I hope this doesn't disrupt that too much.
One of the reasons cited was the weak CS4 sales. Ironically I was contemplating upgrading to CS4 master suite only a few hours before hearing about this. Now, I think I'll wait a bit. I imagine there's a chance of a price drop if sales are so dire. I wonder if many people are thinking that way? If so, it's maybe another case of bad news causing more bad news.
Good luck guys.