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pinterest The company announced Tuesday that it plans to lay off less than 15% of its employees and reduce office space as it introduces artificial intelligence.
Pinterest said in a securities filing that it expects the cuts to be completed by the end of the third quarter in late September. Pinterest’s stock price fell more than 9%.
The social media company said it was “reallocating resources” to AI-focused teams and prioritizing “AI-powered products and features.” The company also said it is restructuring its sales and marketing strategies.
The company said it expects to record pretax restructuring charges of approximately $35 million to $45 million.
Pinterest had more than 4,500 employees worldwide as of April last year, according to its latest proxy filing.
Pinterest is introducing AI across its platform to show users more personalized and relevant content. Last October, the company released a shopping tool called Pinterest Assistant.
At the same time, Pinterest rolled out more automated advertising tools for marketers in the face of increasing competition from TikTok. metaFacebook and Instagram.
“Our investments in AI and product innovation are paying off,” Pinterest CEO Bill Ready said in November. “We have become a leader in visual search, effectively turning our platform into an AI-powered shopping assistant for our 600 million customers.”
Pinterest isn’t the only company scaling back as it invests in AI. According to consulting firm Challenger, Gray & Christmas, AI was cited as the reason for about 55,000 people being laid off in the US last year.
Some experts have questioned whether this technology is the real cause of the layoffs, saying some companies may be doing an “AI wash” or are blaming new technology for layoffs to hide cost-cutting efforts or other business issues.
