Snap Inc, the parent company of social media app Snapchat, announced it will lay off around 1,000 employees, or 16% of its workforce, blaming "rapid advancements in artificial intelligence" as one of the key reasons.
The layoffs come amid pressure from activist investor Irenic Capital Management, which had called on Snap CEO Evan Spiegel to reduce costs and headcount.
In an internal memo, Spiegel claimed the job cuts would move Snap towards profitability and suggested AI could fill the labour gap, stating that "rapid advancements in artificial intelligence enable our teams to reduce repetitive work, increase velocity, and better support our community, partners, and advertisers."
Snap joins a growing list of tech companies, including Microsoft, Amazon, Oracle and Block, that have slashed tens of thousands of jobs while simultaneously embracing AI tools. These firms argue that AI allows them to operate more efficiently with less human input.
However, some experts and workers accuse companies of "AI-washing" layoffs as an excuse and to posture for investors, with prominent VC Marc Andreesen similarly claiming overstaffed firms are using AI as a scapegoat for cuts.
As backlash against AI's impact on jobs mounts, leading AI companies such as OpenAI and Anthropic have launched charm offensives to address these concerns.
It recently proposed policies like four-day workweeks and a public wealth fund to share AI profits with citizens.
News of Snap's layoffs boosted its struggling stock price by 15% in trading on Wednesday, though it remains down over 30% year-to-date.
As of December, Snap had about 5,200 employees, with plans to leave an additional 300 open roles unfilled.
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The increasing use of AI to justify job cuts reflects the technology's growing capabilities but also raises difficult questions about its effects on employment and the motivations behind corporate layoffs.
As AI continues advancing rapidly, the balance companies strike between efficiency gains and supporting their workforce will be a critical issue to monitor.