Tech companies cut 81,747 jobs in the first quarter of 2026, the highest quarterly total since at least early 2024, as the sector accelerates a reallocation of capital from headcount to artificial intelligence infrastructure.
The figures, compiled by the Kobeissi Letter, a widely followed financial research publication, show layoffs more than doubled from the previous quarter and rose 580% compared with the final three months of 2025.
March alone accounted for 45,800 of the cuts, suggesting the pace intensified as the quarter progressed.
The largest individual contributions came from two of the industry's biggest employers.
Meta Platforms, the parent company of Facebook and Instagram, is planning roughly 8,000 job reductions, while Microsoft is offering voluntary retirement packages to approximately 7% of its US workforce.
Both companies have framed the moves as part of broader budget reallocations, shifting resources towards AI development, chip procurement and data centre construction.
The pattern is consistent across much of the sector: companies are reporting record capital expenditure on AI infrastructure while simultaneously shrinking their human workforces.
Alphabet raised its full-year capital spending guidance to as much as $190 billion after reporting first-quarter results last week, while Meta and Microsoft have each outlined tens of billions in planned AI investment for 2026.
The Kobeissi Letter directly links the layoff surge to increased spending on AI chips and data centres, describing a corporate calculation in which infrastructure investment is being funded in part through headcount reduction.
The dynamic raises a question that has shadowed the AI boom since its earliest stages: whether the technology is creating a structural shift in employment across the sector or whether the current wave reflects a temporary correction after years of pandemic-era overhiring.
Aaron Levie, the chief executive of Box, the cloud content management company, has argued that fears of AI-driven job losses are overstated and that much of the current wave can be explained by companies unwinding hiring decisions made during the low-interest-rate expansion of 2020 to 2022.
There is some evidence for that view: many of the companies now cutting jobs expanded their workforces by 30% to 50% during the pandemic before beginning rolling reductions from late 2022 onwards.
But the scale of capital being redirected towards AI infrastructure suggests something more than a simple correction is underway.
When companies explicitly describe layoffs as funding AI investment, the implication is that certain categories of work are being permanently replaced or restructured rather than temporarily reduced.
The Kobeissi Letter expects the elevated pace of layoffs to continue as companies prioritise AI infrastructure over headcount, a forecast that implies the second quarter could bring further significant cuts.
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For workers in roles most susceptible to automation, including content moderation, customer support, quality assurance and parts of software engineering, the outlook is increasingly challenging.
The broader economic impact remains uncertain, but the first quarter figures suggest the AI investment cycle is producing a measurable contraction in tech employment even as it generates record revenues for the companies leading the transition.
The recap
- Kobeissi Letter reports 81,747 tech layoffs in Q1 2026.
- March alone accounted for 45,800 job cuts across the sector.
- Meta plans about 8,000 layoffs; Microsoft offering voluntary retirements.
