Atlassian has announced plans to cut approximately 10 percent of its global workforce – around 1,600 employees – as part of a strategic shift towards artificial intelligence and enterprise growth.
The Australian collaboration software firm said the move is part of its ongoing efforts to reshape its "skill mix" and change how the company works to "build for the future”.
In a company-wide message, CEO Mike Cannon-Brookes said: “It would be disingenuous to pretend AI doesn’t change the mix of skills we need or the number of roles required in certain areas. It does. This is primarily about adaptation. We are reshaping our skill mix and changing how we work to build for the future.”
The job cuts come as Atlassian looks to self-fund further investment in AI and enterprise sales, while strengthening its financial profile.
According to Cannon-Brookes, the company is also “changing the way we work and reorganising around our system of work to move faster.”
Investment In AI
The layoffs reflect a strategic shift in Atlassian’s priorities.
Cannon-Brookes stated that the decision would allow the company to focus on AI initiatives and enterprise sales: “The bar for what ‘great’ looks like for software companies – on growth, on profitability, on speed, on value creation – has gone up.”
Despite reporting strong growth in certain areas, including over 25 percent revenue growth from cloud products and more than five million users for its new Rovo AI suite, Atlassian’s market performance has faced headwinds.
The company’s market capitalisation peaked at around $112 billion in 2021 but fell to roughly $30 billion by early 2023.
Shares recently traded around $75 apiece, with a slight pop to $78 in after-hours trading following the CEO’s announcement.
Cannon-Brookes emphasised the company’s positive momentum, writing: “We have momentum. We are executing incredibly well across our AI, Enterprise and System of Work transformations.”
Wider Market Pressures, AI, and Tech Layoffs
The past year has seen a wave of AI-driven workforce reductions across the technology sector, illustrating the growing impact of automation and efficiency pressures.
