Artificial intelligence is changing the technology industry, making it easier for consumers to design images, build websites, create presentations, and complete tasks that once required specialized software. However, the rapid adoption of the technology is creating new challenges for the companies providing those tools. Recently, the website-building platform Squarespace eliminated approximately 300 positions, primarily in product and engineering teams. The company said the restructuring was not directly tied to its AI investments but acknowledged the need to adapt to changing technology. Canva, the popular online design platform used by businesses, educators, and consumers worldwide, is a more recent example, as it makes one of the biggest organizational changes in its history. The Australian company is restructuring more than one-fifth (22%) of its workforce after acknowledging that growth has slowed for the first time in a decade. However, its unusually generous severance package is drawing attention as other major technology companies continue eliminating thousands of jobs. : Disney eyes thousands more layoffs as major cost-cutting push widens Canva restructuring affects 1,271 employees, CEO apologizes In a Nov. 3 message to employees, co-founder and CEO Melanie Perkins announced organizational changes affecting 1,271 people, representing approximately 22% of Canva’s workforce. However, not all affected employees will lose their jobs. Perkins explained that some positions will change, certain employees will be asked to relocate, and others will leave the company. Canva has not disclosed how many jobs will ultimately be eliminated. “This is without doubt the hardest moment in our thirteen-year history,” Perkins wrote. The company plans to combine its Product, Growth, and Platform teams into a single organization, consolidate overlapping responsibilities and reduce management layers. Sydney will become the primary location for more product teams, with certain employees asked to consider relocation. Canva is also tightening its hybrid-working arrangements. Beginning in January 2027, most hybrid employees will be expected to work from an office approximately two to three days per week, depending on local requirements. The company said the restructuring would help teams make decisions faster, improve collaboration and focus on its most important products, while acknowledging its impact on employees. “I’m deeply sorry for the pain and disruption this will cause for everyone affected. While nothing can make this news easier, we will do everything we possibly can to support everyone affected,” said Perkins. Canva is eliminating 22% of its workforce. Bloomberg / Getty Images Canva’s severance package compares favorably with other tech layoffs Despite the scale of the restructuring, Canva’s decision to offer departing employees at least six months’ salary stands out among the severance packages announced during this year’s technology layoffs. The package includes statutory entitlements and applies regardless of location. Departing employees will also receive 12 months of healthcare coverage in countries where Canva currently provides it, along with career coaching, one year of LinkedIn Premium, and continued employee assistance support. The company is removing the one-year equity-vesting cliff for recent hires, allowing departing employees to retain their company-issued MacBooks and is offering US$10,000 grants through its new Canva Collective Fund to eligible employees interested in starting businesses or community projects. How 2026 tech layoff severance packages compare I compared severance packages across nine companies using their publicly available company statements, executive communications, and regulatory filings, which reveal considerable differences in how major businesses compensate workers following layoffs. Company Severance package Additional benefits Canva At least 6 months’ salary, including statutory entitlements 12 months’ healthcare where provided, equity relief, laptop, career support and opportunity to seek a $10,000 grant Cloudflare Equivalent of full base pay through Dec. 31, 2026, following May layoffs U.S. healthcare support through year-end and extended equity vesting Block 20 weeks + 1 week per year of service for U.S. employees 6 months’ healthcare, $5,000 transition payment, equity benefits and company devices HubSpot 20 weeks + 1 week per year of service, capped at 30 weeks; regional variations 5-month U.S. COBRA payment, career support and laptop Dropbox 16 weeks + 1 week per completed year; international variations 6 months’ U.S. healthcare subsidy, eligible bonuses, equity vesting and laptop Atlassian Minimum 16 weeks + 1 week per year of service 6 months’ eligible healthcare, prorated bonus and $1,000 technology payment Etsy At least 16 weeks + additional tenure-based compensation Up to 12 months’ healthcare, incentive payments and equity benefits Epic Games At least 4 months’ base pay, with additional tenure-based compensation 6 months’ U.S. healthcare and extended stock-option benefits Squarespace Minimum 16 weeks, with additional pay based on tenure Benefits through May 2027, laptop and immigration assistance Note: These are publicly disclosed terms from 2026 workforce reductions. Benefits vary by country, tenure, and eligibility, and the packages are not directly comparable. Canva’s six-month minimum exceeds the starting severance offered by several other technology companies, including Dropbox, Atlassian and Squarespace. However, Cloudflare’s May package promised departing employees the equivalent of their full base salaries through the end of 2026, potentially exceeding Canva’s offer. The comparison also highlights how the value of severance packages can vary with employee tenure. Canva’s AI expansion comes with growing costs Despite announcing changes affecting 1,271 employees, Canva has not yet disclosed the estimated financial cost of its restructuring or how many workers will ultimately lose their jobs. The workforce changes follow a challenging period for Canva’s artificial-intelligence strategy. In an exclusive August interview with Fortune, Perkins acknowledged that demand for Canva’s newer AI features had exceeded the company’s expectations. Although the strong adoption demonstrated customer interest, it also made the features more expensive to deliver. Canva subsequently reduced its expected annual revenue growth rate from approximately 30% to 20% and slowed the rollout of some AI products while reducing the technology’s underlying costs. More Layoffs: Disney cuts 300 jobs and major overhaul puts hundreds more at risk Microsoft cuts hundreds more jobs as restructuring deepens Oracle layoffs top 2,500 workers as AI spending surges Perkins said the company had reduced the cost of completing an AI task by nearly 90% since launching Canva AI 2.0 in April. The challenge reflects a broader shift in software economics. Traditional software products can often serve additional users at relatively low incremental cost. Generative AI features, however, require computing resources each time users generate content, making widespread adoption more expensive. Nonetheless, Canva has continued to expand its AI capabilities despite those pressures. In October, the company launched Canva Research, bringing together researchers and engineers developing its artificial-intelligence technology. It also introduced Canva Craft, expanding its AI-powered creative tools. While Canva has linked its restructuring to changing technology, slower growth and organizational complexity, it has not said artificial intelligence directly replaced the jobs being eliminated. Canva previously eliminated jobs before latest changes The November announcement follows smaller reductions earlier in Canva’s history. According to an exclusive investigation by Australian publication Capital Brief, the company eliminated 32 positions in its finance division in January 2026. The affected employees were offered redundancy packages, internal job opportunities and career assistance. Canva also eliminated 10 of its 12 technical-writing positions in March 2025, according to earlier reporting referenced by the publication. The latest restructuring extends considerably further across the organization and comes as other major technology companies continue adjusting their workforces. Cloud storage provider Dropbox recently eliminated approximately 200 positions, representing 9% of its workforce, as it reorganized its engineering, product, design, and administrative teams. As TheStreet previously reported, a California WARN notice identified 57 positions affected at Dropbox’s San Francisco headquarters. Microsoft has also undertaken multiple rounds of layoffs this year, while Oracle has continued to reduce its workforce as it expands its investments in AI infrastructure. TheStreet previously identified more than 2,500 positions affected by Oracle layoffs across multiple states through September. These companies have cited different reasons for their workforce reductions, including restructuring, changing product priorities and the need to operate more efficiently. For Canva, the immediate challenge involves simplifying an organization that expanded rapidly while supporting increasingly sophisticated and expensive AI products. Perkins acknowledged that the company had considered alternatives before deciding smaller organizational changes would not be sufficient. A company-wide meeting is scheduled for November 10, when employees are expected to receive more information about the company’s new structure and the path ahead. Related: Amazon cuts more jobs as CEO touts record margins, retail gains
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