Why would this make more sense than moving to a bigger office or building more space for the new employee to have a desk without taking yours? Cost is absolutely not an answer.
If they can afford to hire more but not to expand and give each worker adequate space, it suggests the company is just wrong. They actually can’t afford to hire more and would be creating problems if they do. Rather, reinvest what would have been spent on crammed headcount into the ability to expand spatially and later increase headcount with adequate space.
If a company, even a sink-or-swim growth mode start-up, believes it needs to hire people faster than it can provide minimally adequate space for them, then the company is just wrong. That is just not a thing.
Costs do not affect revenue. Perhaps you mean profit?
I'm not arguing for hot-desking as a standard approach, which indeed likely negates any benefits to teams being co-located. But for people who are allocated space that they rarely use? Why not?
People who think cost drives open plan office choices seem to think corporate management are too stupid to ask, what is 10% of our total salary base for these workers. It makes no sense. People have been measuring productivity and morale in knowledge work for a hundred years. Of course they can directly compare cost savings on floor space with metrics correlated with productivity lost to worse workspace, and tie it to the bottom line.
The observable spending habits of companies suggest cost utterly cannot be a driving factor here.