Snap Inc, the parent company of Snapchat, has announced plans to lay off approximately 1,000 employees, representing 16% of its workforce. The decision, communicated in an internal memo on Wednesday, attributes the cuts to “rapid advancements in artificial intelligence”.
The layoffs follow pressure from Irenic Capital Management, an activist investor that recently urged CEO Evan Spiegel to reduce costs and headcount. In his memo to staff, Spiegel said the move would help the company move toward profitability and suggested AI could compensate for reduced human labour.
Snap joins a wave of tech firms, including Microsoft, Amazon and Oracle, that have cut thousands of jobs while embracing AI tools. However, experts and former workers have accused some companies of “AI-washing” layoffs, using the technology as an excuse for earlier overstaffing.
Despite the cuts, Snap’s stock rose about 6% in early trading on Wednesday, recovering some losses after a 30% drop year-to-date. The company employed roughly 5,200 people as of December last year and will also halt the filling of 300 open roles.
