Canva is laying off 1,271 employees, representing approximately 22% of its workforce, as the Australian design software company restructures its operations in response to slowing revenue growth and rising artificial intelligence costs. The job cuts accompany organizational changes intended to reduce internal complexity and improve coordination across its product development teams.
Co-founder and CEO Melanie Perkins informed employees of the decision in an internal message, acknowledging that the company had experienced its first growth slowdown in a decade. She described the past year as Canva’s most difficult period and said the company’s existing operating structure needed to change.
Canva Restructures Teams and Workplace Policies
Canva plans to combine its product, growth, and platform teams under a reorganized management structure. The changes are intended to reduce communication barriers between departments and improve the speed of product development.
The company will also reduce the degree of specialization across some roles, requiring remaining employees to take on a wider range of responsibilities. Canva is additionally moving toward a hybrid working model, with employees expected to spend several days each week in the office.
In her message, Perkins acknowledged the contributions employees had made during Canva’s 13-year development into a platform serving hundreds of millions of users. However, she said the company’s previous growth did not guarantee continued success under changing market conditions.
Restructuring Affects 22% of Employees
In its official restructuring announcement, Canva clarified that the 1,271 affected employees include those facing layoffs, role changes, or relocation, rather than exclusively job losses. The company has not disclosed the exact number of employees who will leave.
Departing employees will receive at least six months of salary, up to 12 months of continued healthcare coverage, and career transition assistance. Canva will also offer $10,000 grants to eligible departing employees interested in starting businesses or community initiatives.
AI Costs and Competition Pressure Revenue Growth
Canva previously reduced its revenue growth forecast from 30% to 20%, citing increasing costs associated with artificial intelligence development. The company has been developing its own AI models to reduce operating expenses and reliance on external providers.
The slowdown also prompted some early investors to lower their assessment of Canva’s valuation to approximately $35 billion earlier in 2026. Meanwhile, Canva faces competition from AI-focused design startups and general-purpose chatbots, including ChatGPT and Gemini, which provide image-generation and presentation-building capabilities.
Featured image credits: MrPaloma
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