Canva cuts 22% of staff, 1,271 roles, after its growth slowed for the first time in a decade. The numbers

Canva is restructuring 22% of its workforce, about 1,271 people. Co-founder and CEO Melanie Perkins announced the cuts to staff this week. TechCrunch says the move follows the design platform's first growth slowdown in a decade. Some affected employees will be laid off, others moved into new roles, and others asked to relocate, Adweek and Inc. report. People Matters says Canva has more than 5,700 employees in 37 countries.

Why it matters: for more than a decade Canva grew by making design easy for non-designers. Now general-purpose chatbots such as ChatGPT and Gemini can generate posters and slides from a prompt, TechCrunch notes. Canva is also paying more to run AI features. This restructuring is the clearest sign yet that AI is squeezing an incumbent on two fronts at once: product competition and cost.

The numbers

According to Inc., Perkins wrote that growth had "slowed for the first time in a decade" and that Canva needs to "refound" itself. People Matters quotes the memo calling this the hardest moment in the company's 13-year history. Canva hasn't published revenue figures alongside the announcement.

What changes inside Canva

• Fewer layers, bigger teams. Product, growth and platform will merge into one product organisation, with fewer management layers, CTech and Inc. report. TechCrunch adds that Canva wants less "subspecialisation," so people take on broader jobs.
• Sydney becomes the hub. CTech and People Matters report that more product teams will be based in Sydney. Some staff will be asked to move to centralised hubs.
• Back to the office. From January, most hybrid employees will be expected in the office two to three days a week, according to CTech.
• Its own AI models. TechCrunch says Canva has been building in-house AI models to cut costs and rely less on third-party providers.

The severance package

People Matters and Inc. report that departing employees get at least six months' salary, including statutory entitlements, wherever they're based. People Matters lists the rest:

• 12 months of continued healthcare in countries where Canva provides it
• the one-year vesting cliff waived for employees who joined in the past year
• a year of Canva's employee assistance program, career coaching and LinkedIn Premium
• the option to keep their company MacBook
• $10,000 grants from a "Canva Collective Fund" for people starting a business or a community project. Canva takes no equity, and registration closes December 14

Timing will vary by country because of local consultation rules, Inc. notes. An all-hands meeting on the restructuring is scheduled for November 10, according to People Matters.

Is it AI?

The memo, as reported, doesn't name AI as the reason, Inc. points out. But the context is hard to miss. TechCrunch reports that the forecast cut was driven by rising AI costs. Its biggest new competitors are AI image tools from OpenAI and Google. And it's pushing its own models to cut its bill. CTech places the cuts alongside other Australian tech restructurings this year: Atlassian cut 1,600 jobs in March, and WiseTech Global cut about 26% of staff.

What to watch

• The November 10 all-hands, which may show which teams and markets are hit hardest. Canva hasn't said.
• Pricing. If AI costs are hurting margins, watch whether Canva raises the price of its AI features or limits them more tightly.
• Its in-house models. Whether those models can deliver Canva's AI features more cheaply than third-party providers will decide how much of the 30% growth rate it can win back.