Snap Inc is eliminating around 1,000 roles, accounting for 16 per cent of its workforce, as the Snapchat parent company points to artificial intelligence developments as justification for the cuts.
Chief executive Evan Spiegel told staff on April 15 that the firm had reached "a crucible moment", with the restructuring designed to cut annual costs by $500million (£368million).
In an internal memo, Evan Spiegel said remaining employees would use AI technology to "reduce repetitive work and increase velocity".
The company has also removed around 300 vacant roles that had previously been advertised.
This marks at least the third major round of redundancies at Snap since 2022, when the social media firm reduced its workforce by 20 per cent.
The job cuts follow pressure from activist investor Irenic Capital Management, which acquired a stake in the company earlier this year.
In a public letter to Evan Spiegel last month, a portfolio manager at the firm called for cost reductions and workforce cuts while criticising Snap’s strategy.
The investor said it was "strange" that Snap had failed to turn a profit despite operating for 15 years and attracting hundreds of millions of monthly users.
The letter also highlighted a decline in shareholder value, stating that an investment of $1 at the time of Snap’s 2017 flotation would now be worth around 23 cents.
Snap’s share price had fallen more than 30 per cent since the start of the year before the announcement, though it rose by around six per cent in early trading following news of the layoffs.
Evan Spiegel said: "Change of this magnitude and at this speed is never easy and it will not be seamless."
He added that "small squads" of employees had already been using AI tools in recent months, with the approach now set to expand across the company.
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The announcement is the first time Evan Spiegel has directly linked artificial intelligence to staffing decisions at Snap.
Snap employed around 5,200 people as of December last year, according to regulatory filings.
In his message to staff, Evan Spiegel said the company now required "a new way of working that is faster and more efficient, while pivoting towards profitable growth".
He indicated the job reductions would support a shift towards profitability, with AI tools taking on some responsibilities previously handled by employees.
Snap joins a number of major technology firms implementing job cuts while citing artificial intelligence capabilities.
Microsoft, Amazon, Oracle, Meta, Pinterest and Atlassian have collectively reduced tens of thousands of roles this year.
Block chief executive Jack Dorsey said in February that AI tools for technology workers "fundamentally changes what it means to build and run a company".
He added that "the majority of companies" would announce further job losses over the coming year.
Some figures in the industry have questioned the reasoning behind such decisions.
Venture capitalist Marc Andreessen recently suggested companies may be using artificial intelligence as justification for reducing staff numbers following previous hiring increases.
Former employees and some executives have also raised concerns that firms are presenting redundancies as being driven by AI to appeal to investors.
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