A CEO looking at the economic climate of 2020-2021 and thinking they needed to hire to support the growth in demand for their products is not being negligent, they simply lacked the crystal ball that would have told them the Fed was going to slam the brakes on the economy last year. Even the Fed said they wouldn't be doing that. In light of what's happened, companies need to get leaner to survive.
Now if these CEOs don't manage to turn the ship around in the next couple years it probably is in fact time to look for a replacement.
What's the point in paying people tens or hundreds of millions of dollars if they make the same predictions and bad decisions as everyone else? And have exactly one contingency plan if things go sideways? Which is also everyone else's plan btw and not even a very good one. They hired in a seller's market for talent, and are now firing in a buyer's market.
You could hypothetically have a CEO that was good in a period of economic expansion but poor in a period of economic contraction. By the time you figure out you have one of these CEOs at the helm, it's probably too late to do much about it. And any replacement CEO you bring in is all the more likely to make drastic cuts to cost centers (headcount).
Now if these CEOs don't manage to turn the ship around in the next couple years it probably is in fact time to look for a replacement.