1 of 3 | Traders work on the floor at the New York Stock Exchange in 2017 as Snap’s initial public offering debuts in New York City. The parent company of Snapchat announced Wednesday that it’s cutting about 16% of its workforce in favor of artificial intelligence tools. File Photo by Monika Graff/UPI | License Photo
April 15 (UPI) — Snap Inc., the parent company of messaging and social media app Snapchat, announced Wednesday that it’s cutting up to 16% of its workforce worldwide and plans to use artificial intelligence tools for many tasks. This will affect about 1,000 people and cut about 300 open positions at the company.
Evan Spiegel, the chief executive officer of Snap Inc., said in a memo to staff that AI will allow the company to be more efficient and profitable.
“We believe that rapid advancements in artificial intelligence enable our teams to reduce repetitive work, increase velocity and better support our community, partners and advertisers,” Spiegel wrote, CNBC reported.
The company’s shares rose about 7% Wednesday after it announced the layoffs. Last month, a portfolio manager from activist investor Irenic Capital Management wrote Spiegel a letter criticizing the company’s strategy and calling on it to cut costs and people by using AI, The Guardian reported.
Snap said that AI is already creating about two-thirds of its new code and answering more than a million questions each month, CNBC said. A company spokesperson told CNBC that the decisions to lay off staff members were “incredibly difficult,” but that the changes will “better align our resources behind our highest priorities.”
This news is the latest in a trend of companies enacting mass layoffs while turning to AI tools instead. Amazon, Oracle, Microsoft, Uber and Block are among the companies that have slashed human staff and cited use of AI to make up for the cuts.
Snap had forecast $1.5 billion in revenue for the first quarter of 2026, an increase of 12%. The company, founded in 2011, employed about 5,000 people last year.