Canva Lays Off 1,271 Employees and Cuts Growth Forecasts Amid Rising AI Costs
Australian design platform Canva has announced a restructuring plan affecting 1,271 employees, representing approximately 22% of its workforce, as reported by kursors.lv. The cuts arrive as the company faces its first growth slowdown in a decade. Canva currently employs roughly 5,800 people across 37 countries, and a recent employee share sale valued the business at approximately 38.6 billion euros, according to notepad.lv.
Co-founder and Chief Executive Officer Melanie Perkins described the period in a letter to staff as the most difficult in the company’s history, noting that past success does not guarantee future momentum, while Canva lowered its 2026 revenue growth forecast from 30% to 20% in August due to the high expenses associated with artificial intelligence features, which have slowed their rollout.
Restructuring Product Teams and Moving Headquarters to Sydney
Canva plans to merge several departments, including product development, growth, and technological infrastructure teams, to simplify internal communication and speed up decision-making. kursors.lv noted that employees will take on broader responsibilities under the new structure. notepad.lv reported that Sydney will serve as the main headquarters for most product teams, though the company has not disclosed the exact breakdown of job losses versus role changes or relocations.
Beginning in January 2027, hybrid employees must work from an office two to three days a week. For affected workers, Canva is offering a minimum of six months’ pay, 12 months of health insurance, career support, and the option to keep work laptops. notepad.lv stated that departing staff will also receive a grant of approximately 9,200 euros, and employees who joined within the past year will see the waiting period for stock options waived.
Rising Competition from Generative AI Rivals
Canva faces mounting pressure from standalone generative AI tools like ChatGPT and Gemini. While users historically relied on Canva for posters, presentations, and digital media, competing AI platforms now generate images and design assets within seconds. To curb its reliance on external technology and manage surging expenses, Canva has begun developing proprietary AI models.
The workforce reduction places Canva among a wave of technology companies restructuring operations. notepad.lv noted that Netflix, Uber, and Dropbox have also trimmed staff in recent months. Meanwhile, Microsoft offered voluntary departures to roughly 60,000 employees, and Barclays plans to eliminate 5,000 jobs while deploying AI solutions.
Frequently Asked Questions About Canva’s Restructuring
How many total employees does Canva have following the announcement?
Canva employs approximately 5,800 people across 37 offices worldwide prior to the completion of the 1,271 job cuts and role shifts.
What financial valuation was placed on Canva in its latest share sale?
notepad.lv reported that Canva was valued at approximately 38.6 billion euros during its most recent employee share transaction.
When do hybrid employees need to return to physical offices under the new policy?
Affected hybrid workers must report to a company office two to three days per week starting in January 2027, as reported by notepad.lv.