Design software giant Canva is laying off 22% of its workforce, affecting 1,271 employees, as the company grapples with its first major growth slowdown in a decade, rising operational expenditures, and shifting market dynamics.
The sweeping cuts were announced to staff by Canva co-founder and chief executive officer Melanie Perkins in a candid internal note. The workforce reduction marks a profound inflection point for the Australian tech unicorn, which has spent the last thirteen years scaling from a fledgling pitch deck concept into a ubiquitous global platform used by hundreds of millions of individuals and businesses.
Reflecting on the milestone in her communication to employees, Perkins acknowledged the gravity of the decision while honoring the contributions of the staff. Over more than a decade, the company transformed how the world approaches graphic design, presentations, and visual communication. However, Perkins emphasized that past achievements do not automatically secure future success in a rapidly evolving technological landscape.
"Over the past thirteen years, we’ve turned a dream in a pitch deck into a platform used by hundreds of millions of people. None of it would have been possible without the talent, imagination, and care of every single person who has been part of this journey. Yet success in our first chapter doesn’t guarantee success in the next. This has been our hardest year yet, and as we shared earlier this year, our growth has slowed for the first time in a decade," Perkins wrote.
The layoffs are part of a broader corporate restructuring designed to realign Canva’s operational structure with its current growth trajectory. In an effort to streamline operations and dismantle bureaucratic silos, the company is actively reshuffling its organizational chart. As part of this internal overhaul, Canva is merging its product, growth, and platform teams. Management hopes that combining these distinct departments will reduce communication friction, accelerate product development cycles, and foster closer collaboration across engineering and business units.
Additionally, Canva is working to reduce what leadership characterizes as "subspecialisation" within the organization. This shift means that remaining employees will likely be asked to broaden their skill sets, take on more diverse responsibilities, and operate with greater cross-functional flexibility. Alongside these structural and personnel changes, the company is also adjusting its workplace policies, shifting further toward hybrid work models and requiring employees to report to physical office locations a few days each week.
The decision to cut over a quarter of its workforce comes against a backdrop of mounting financial and operational pressures. Canva has invested heavily in developing its own proprietary artificial intelligence models in an effort to minimize infrastructure costs and reduce its reliance on expensive third-party AI providers. Despite these cost-saving measures, the company has faced extraordinary financial headwinds driven by the massive computational expenses required to power modern AI features at scale.
These ballooning expenses forced Canva to revise its financial outlook earlier this year, cutting its projected revenue growth forecast significantly from 30% down to 20%. The downward adjustment in financial performance naturally impacted investor sentiment. Earlier this year, early-stage investors adjusted Canva’s private market valuation downward, slashing it to approximately $35 billion as the broader tech sector recalibrates its expectations for hyper-growth software companies.
Compounding these internal cost pressures is an increasingly competitive market landscape. Canva now finds itself locked in a fierce battle on multiple fronts. On one side, the company faces agile new AI-native startups that are continuously rolling out advanced creative tools. On the other side, Canva is contending with the rapid proliferation of general-purpose conversational chatbots, such as OpenAI’s ChatGPT and Google’s Gemini. Equipped with powerful native image generation and document-creation capabilities, these mainstream AI assistants allow everyday users to effortlessly generate marketing posters, slide decks, and social media graphics without needing dedicated design platforms.
As Canva navigates this turbulent chapter, the company is betting that a leaner workforce, simplified team structures, and a renewed focus on core efficiencies will help it weather the current slowdown and secure its competitive edge in the next era of digital design and artificial intelligence.
