Atlassian CEO cites AI shift when announcing plan to shed 1,600 jobs

[NEW YORK] Atlassian chief executive officer Mike Cannon-Brookes announced plans to cut about 1,600 workers, saying the shift to artificial intelligence (AI) was a key factor behind the move.

The cuts, which amount to about 10 per cent of the company’s workforce, are about adapting to the AI era, he wrote in a note to employees.

“It would be disingenuous to pretend AI doesn’t change the mix of skills we need or the number of roles required in certain areas,” Cannon-Brookes said. “It does.”

The rationale was reminiscent of one given by Jack Dorsey’s Block, which pointed to AI last month when moving to fire about 40 per cent of its staff. Oracle, too, has said that AI is allowing the company to make some software development teams smaller.

Atlassian, based in Sydney, expects to incur about US$230 million in expenses such as severance costs due to the cuts.

The company’s stock rose about 2 per cent in extended trading after the layoffs were announced.

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The maker of collaboration tools such as Jira and Trello has seen a steep sell-off this year, losing more than 50 per cent of its value to Wednesday’s close. It has been battered by broader concerns that AI will disrupt traditional software companies.

“The bar for what ‘great’ looks like for software companies – on growth, on profitability, on speed, on value creation – has gone up,” Cannon-Brookes said. BLOOMBERG