Snap has announced plans to cut about 1,000 jobs, representing roughly 16% of its workforce, as part of a broader push to reduce costs and deepen its reliance on artificial intelligence in day-to-day operations.
The company also confirmed that more than 300 open roles will be closed. The move follows pressure from activist investor Irenic Capital Management, which recently acquired a 2.5% stake and called for strategic changes to improve overall performance.
Irenic had urged to reduce headcount, reassess its investment strategy, and consider either spinning off or shutting down its augmented reality division, Specs.
According to Snap, ongoing improvements in artificial intelligence are already helping to automate repetitive tasks, allowing the company to maintain productivity with fewer employees.
Chief executive Evan Spiegel informed staff that the company expects to achieve over $500 million in annual savings by the second half of 2026. These savings are expected to come mainly from reduced operational expenses and lower stock-based compensation.
Snap Shares Rise Despite Layoffs and Restructuring Charges
The layoffs will result in charges estimated between $95 million and $130 million, with most of the impact expected in the second quarter.
Despite the restructuring, Snap highlighted steady business momentum. The company projects first-quarter revenue of approximately $1.53 billion, reflecting about 12% year-on-year growth, while adjusted core profit is expected to reach $233 million, exceeding market expectations.
Following the announcement, Snap shares climbed more than 10% in premarket trading, although the stock remains down around 31% year-to-date.
Investor attention is also focused on Specs, Snap’s augmented reality glasses unit, which has already received more than $3.5 billion in investment and continues to burn roughly $500 million annually. The company plans to bring the product to consumers later this year, despite intensifying competition.
Rivals such as Meta Platforms currently hold a stronger position in the smart glasses market, raising questions about the long-term viability of Snap’s AR ambitions.
Snap now joins a growing list of tech companies undertaking workforce reductions in 2026 as firms look to streamline operations and improve profitability.
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