Snap Inc blames AI as it lays off 1,000 workers

Cuts by Snapchat's parent company come in response to a declining stock price and pressure from an activist investor

Snapchat's parent company plans to lay off 16% of its employees, around 1,000 people, citing rapid advancements in artificial intelligence", the social media company told staff on Wednesday in an internal memo. The staff reduction is part of a wave of tech industry layoffs in the past year, with many firms blaming AI for the cuts.

Snap Inc's layoffs follow demands last month from Irenic Capital Management, an activist investor whose portfolio manager wrote a letter to the Snap Inc CEO, Evan Spiegel, calling on him to reduce costs and headcount while criticizing the company's current strategy. In Spiegel's memo to staff, he claimed that the layoffs would move Snap towards profitability and suggested that artificial intelligence could fill the lack of human labor.