Snap, which operates the social network Snapchat, is laying off approximately a thousand employees, representing about 16 percent of its global workforce. At the same time, it is cancelling more than 300 open positions. This was announced by CEO Evan Spiegel in an internal letter to employees. BBC News ↗
Spiegel directly linked the layoffs to advances in artificial intelligence. "The rapid development of AI allows teams to eliminate repetitive work, increase speed, and better serve our community, partners, and advertisers," he wrote, adding that "small teams have already made significant progress on several important initiatives using AI tools." TechCrunch ↗
The company expects the measures to save the equivalent of more than 500 million dollars annually, with the savings beginning to show in the second half of the year. It estimates one-time severance costs at 95 to 130 million dollars. CNBC ↗
Markets reacted positively — Snap's shares rose after the announcement. The decision came several weeks after activist investor Irenic Capital Management, holding a 2.5 percent stake, began pushing the company to optimize its portfolio and improve performance. Yahoo Finance/Bloomberg ↗
Snap is not the only technology company that has recently linked layoffs to the growing use of AI. Other companies, including IBM and Duolingo, have made similar arguments in their reorganizations. The trend is fueling a debate about the extent to which artificial intelligence will reshape the labor market in the future. Variety ↗
Snap is laying off a thousand people. The company says AI allows it to work with smaller teams
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