Snap CEO Eyes AI Tools for Cost Cutting

Snap Inc. Is laying off 1,000 employees, approximately 16% of its workforce, and eliminating over 300 vacant roles as part of a cost-cutting initiative driven by advancements in artificial intelligence.

Chief Executive Evan Spiegel communicated the decision to staff in a memo, describing the situation as a “crucible moment” for the company and emphasizing the need for more efficient operations to achieve sustainable, profitable growth.

Spiegel stated that AI tools are enabling employees to reduce repetitive work and increase velocity, allowing smaller teams to accomplish more across key initiatives such as Snapchat+, enhanced ad platform performance, and improvements in the Snap Lite infrastructure.

The company aims to reduce its annualized cost base by over $500 million by the second half of 2026, a target Spiegel said should create a clearer path to net-income profitability.

This round of layoffs marks at least the third major workforce reduction at Snap since 2022, when the company first cut 20% of its staff.

Spiegel noted that the changes are being made in response to pressure from activist investor Irenic Capital Management, which has criticized Snap’s prolonged lack of profitability despite its large user base.

Following the announcement, Snap’s stock rose approximately 7%, reflecting investor approval of the shift toward cost control and AI-driven efficiency.