Snap, the parent company of disappearing messaging app Snapchat, said Wednesday that it’s laying off 1,000 workers to reduce costs.
The Santa Monica social media company is pursuing profitability and efficiency as it faces stiff competition for ad dollars from bigger rivals such as Facebook parent company Meta and Google.
Snap said it’s slashing 16% of its full-time workforce and closing more than 300 open roles. The cuts will reduce Snap’s annualized cost base by more than $500 million by the second half of this year.
“Over the past several months, we have carefully reviewed the work required to best serve our community and partners, and made tough choices to prioritize the investments we believe are most likely to create long-term value,” said Snap Chief Executive and co-founder Evan Spiegel in a memo to employees on Wednesday.
The memo, which was included in a government filing, also mentions that Snap’s employees are using artificial intelligence tools to “drive meaningful progress” across several initiatives such as Snapchat Plus — a subscription service that offers users early access to new features and ways to customize the Snapchat app.
“While these changes are necessary to realize Snap’s long-term potential, we believe that rapid advancements in artificial intelligence enable our teams to reduce repetitive work, increase velocity, and better support our community, partners, and advertisers,” Spiegel said in the memo.
Snap is the latest tech company to cite efficiency gains from AI as it cuts jobs and pull back on hiring. Tech companies such as Meta, Block, Amazon, Oracle and others have been laying off workers this year.
Snap’s layoffs also come after activist investor Irenic Capital Management took a stake in the company and called for the company to cut costs through layoffs and other efforts. Snap said that its restructuring efforts are estimated to cost between $95 million to $130 million because of severance, contract termination expenses and other charges.
Outside of its finances, Snap has grappled with other hurdles.
Like other social media companies, Snap has faced criticism that it’s not doing enough to protect the mental health of teens and mitigate potential harms such as illegal drug sales. The company revolutionized social media by popularizing vertical video and disappearing posts, but rivals such as Meta-owned Instagram copied its features. It has also bet on smartglasses, but convincing consumers to buy them has been an uphill battle.
Snap has been investing heavily on developing augmented reality glasses that will allow people to browse the internet, interact with friends and family, play games and do other tasks without having to scroll through their smartphone. The company plans to start selling its AR glasses to consumers later this year, taking on rivals such as Meta, Google and Apple.
More than 940 million people use Snapchat every month on average. Even though the company has been inching closer to 1 billion users, it has struggled to turn a profit. Despite efforts to get people to pay subscription fees and buy glasses, Snap still makes most of its money from digital ads.
In 2025, Snap’s annual revenue totaled $5.93 billion, up 11% compared to 2024. It reported a net loss of $460 million, down from the $698-million net loss Snap had in 2024.
Over the last five years, Snap’s share price has dropped roughly 90% as investors have become more wary of a potential turnaround. On Wednesday, Snap’s shares rose around 5%.
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