Canva Cuts 22% of Staff Amid Slowing Revenue Growth
Australian design platform Canva has announced significant layoffs, marking the first mass reduction in its 13-year history. The company plans to restructure 1,271 positions, which accounts for 22% of its global workforce. The move involves job eliminations, role adjustments, and compulsory relocations to centralized offices.
Reasons Behind Canva’s Workforce Reduction
CEO Melanie Perkins communicated the difficult decision to staff, emphasizing the impact on the team. The layoffs come as Canva experiences a slowdown in revenue growth. Initially targeting a 30% revenue increase in 2026, the company now anticipates approximately 20% growth this year, following previous growth rates of 45% in 2024 and 38% in 2025. The annualized revenue reached $3.69 billion, falling short of an internal goal of $5.2 billion.
A significant factor contributing to this decline is emerging competition from AI-driven design tools developed by companies like OpenAI and Google. These tools allow users to create complex designs with simple text commands, directly challenging Canva’s traditional value proposition.
How Canva Is Navigating AI Challenges
Despite being an early adopter of artificial intelligence, with acquisitions such as Leonardo.ai and the development of its own Magic Studio, Canva now faces competition powered by the same AI technology it integrated into its platform. Perkins explained that the restructuring was carefully aligned with the company’s mission and future objectives, which dictated necessary changes in structure, skill sets, and office locations.
Employees affected by layoffs will receive severance packages that include six months of salary, continuation of health insurance coverage for up to a year where applicable, and the retention of company laptops. Additionally, Canva is providing a $10,000 grant to support those who might pursue entrepreneurship after their departure.
Implications for Pakistan’s Technology Sector
Canva’s restructuring underscores a growing trend in the global tech industry, where AI advancements are prompting companies to reevaluate their business models and workforce needs. For Pakistan’s burgeoning tech ecosystem, reliant on startups and digital design tools, this development highlights both the disruptive potential of AI and the importance of agility in innovation and workforce management.
As local companies explore AI integration, understanding the balance between technological opportunity and market competition becomes critical. Canva’s experience serves as a case study for how global shifts might influence Pakistan’s tech enterprises and employment landscape moving forward.
