Snap to Cut 1,000 Jobs as AI Produces Most New Code
Snap will cut about 1,000 jobs, 16% of staff, saying AI now generates over 65% of new code and the reductions should save more than $500 million annually by mid-2026.
Snap Inc. announced on Wednesday it will lay off about 1,000 full-time employees, roughly 16% of its workforce. The company listed about 5,261 full-time employees in December 2025 and plans to eliminate more than 300 open roles. Snap expects to record implementation costs of $95 million to $130 million in the second quarter and projects the restructuring will lower annualized costs by more than $500 million by the second half of 2026. The company forecast first-quarter revenue of about $1.5 billion, a roughly 12% increase year over year.
Chief Executive Evan Spiegel wrote to employees that Snap needs a new way of working that is faster and more efficient while shifting to profitable growth. He noted small teams using AI tools have advanced projects including Snapchat+, improvements to the ad platform and efficiency gains in Snap Lite infrastructure. Spiegel wrote, “rapid advancements in artificial intelligence enable our teams to reduce repetitive work, increase velocity, and better support our community, partners, and advertisers.”
Snap reported AI agents are generating more than 65% of new code and handling over 1 million internal queries each month. The company described these tools as driving substantial operational change and enabling teams to move faster.
The workforce reductions follow recommendations from activist investor Irenic Capital Management, which holds about a 2.5% stake in Snap and in March recommended cutting roughly 1,000 employees. Irenic wrote that “AI can and should replace many existing roles.”
Snap’s stock rose about 8% from Tuesday’s close to Wednesday’s close after the announcement, then eased roughly 1% to trade near $5.97. Shares had fallen more than 30% year to date before the announcement.
Other technology companies have announced job cuts this year while citing AI capabilities and cost reductions. Earlier in the year, Block cut more than 4,000 roles, representing about 40% of its workforce.
The company expects the restructuring will redirect resources to AI-driven product development and core monetization efforts.
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