Artificial intelligence is becoming a central factor in a new wave of technology industry layoffs, with companies cutting thousands of jobs while redirecting spending toward AI infrastructure, automation and specialised technical roles.
More than 20 major employers have connected workforce reductions to AI adoption, organisational restructuring or changing skill requirements during 2026. The list includes Microsoft, Amazon, Oracle, Meta, Google, Salesforce, IBM, PayPal and several other prominent technology companies.
Although executives often reject the idea that AI is directly replacing employees, their announcements show that the technology is influencing how companies allocate resources, design teams and evaluate future staffing needs.
Work management software company Monday.com became one of the latest businesses to connect a major restructuring with its AI strategy.
The company plans to eliminate just over 600 positions, representing approximately 20 percent of its workforce. Monday.com said the changes would support a leaner operating model and help align its product, marketing and sales operations with an AI-driven growth strategy.
Co-founder Eran Zinman told employees that the decision was not intended simply to reduce costs or replace workers with artificial intelligence. Instead, he described the restructuring as part of the company’s transition toward an AI-first business model.
Monday.com expects to record restructuring charges of between $45 million and $55 million. At the same time, the company continues to forecast revenue growth of up to 20 percent for 2026.
The combination of job cuts, restructuring expenses and continued growth projections highlights a wider trend. Many technology companies are reducing headcount even when their businesses remain profitable or are expanding.
US technology companies have reportedly eliminated close to 140,000 positions since the beginning of 2026.
Amazon, Oracle, Meta and Microsoft account for a significant portion of those reductions. Together, the four companies have cut almost 50,000 jobs while continuing to spend heavily on AI data centres, computing infrastructure and new products.
The cuts suggest that the industry is not simply responding to weak demand. In many cases, companies are changing their cost structures so they can invest more aggressively in artificial intelligence.
This shift is creating a new division within the technology labour market. Traditional corporate, support and management roles are being reduced, while demand is increasing for workers with experience in AI engineering, cloud computing, data infrastructure and machine learning.
Oracle disclosed that its global workforce declined by approximately 21,000 employees over a 12-month period, representing a reduction of about 13 percent.
The company acknowledged that the adoption and deployment of artificial intelligence had contributed to workforce changes and could result in further reductions.
Oracle’s layoffs occurred as the company invested heavily in AI data centres and cloud infrastructure. Its remaining contractual obligations also increased substantially, indicating strong future demand despite the reduction in staffing.
Amazon has also made significant cuts. The company eliminated 16,000 corporate positions in January, following a previous round of 14,000 layoffs in late 2025.
Amazon executives have said that wider use of generative AI and AI agents will change how work is performed. The company expects efficiency gains to reduce the number of employees needed for some corporate functions over the coming years.
Microsoft cut approximately 4,800 roles in July, with many of the reductions affecting its Xbox gaming division.
The company said the eliminated positions were not being directly replaced by AI. However, Microsoft also acknowledged that artificial intelligence is changing how employees work and how teams are structured.
Meta eliminated about 8,000 jobs while moving roughly 7,000 employees into AI-focused positions. The changes demonstrate that some companies are not only reducing headcount but also transferring resources from established business areas into artificial intelligence.
Google has taken a less centralised approach. Instead of announcing one large round of layoffs, the company has made ongoing cuts across cloud, cybersecurity, engineering and management teams.
Outside estimates suggest that Google may have eliminated between 1,500 and more than 3,000 engineering positions during 2026. The company has also reduced the number of managers supervising smaller teams.
PayPal plans to reduce its workforce by about 20 percent over the next two to three years. The changes could affect more than 4,500 positions.
The company has created an AI transformation team responsible for redesigning internal processes. Artificial intelligence is expected to play a greater role in software development, customer service, support operations and risk management.
Coinbase announced plans to cut approximately 700 employees, representing about 14 percent of its workforce. The cryptocurrency exchange said it was simplifying its structure and increasing the use of AI across engineering, product and design work.
The company is also experimenting with smaller teams in which one person may handle responsibilities that were previously divided among several specialised roles.
These strategies reflect a growing belief among executives that AI tools can allow smaller teams to complete projects more quickly.
Several companies making major cuts have continued to report strong financial results.
Cloudflare eliminated about 1,100 positions after recording its highest quarterly revenue in company history. Cisco announced nearly 4,000 layoffs despite exceeding profit and revenue expectations.
Dell reduced its workforce by roughly 11,000 employees while forecasting strong growth in sales of servers designed for artificial intelligence workloads.
GitLab cut around 350 jobs while reporting a 23 percent increase in quarterly revenue. The company said it needed to redirect funding toward infrastructure capable of supporting increased demand from AI agents and automated workflows.
These examples challenge the traditional assumption that layoffs are mainly a response to falling revenue or financial distress.
The effect of artificial intelligence on employment is not entirely negative.
AI-focused companies continue to recruit engineers, researchers and infrastructure specialists. Some established corporations are also increasing hiring in selected areas while cutting positions elsewhere.
IBM, for example, has reduced thousands of roles but is also expanding entry-level recruitment for AI and hybrid-cloud jobs. Meta’s decision to transfer thousands of employees into AI-related positions shows how workforce reductions can occur alongside internal hiring and reassignment.
The result is a labour market in which certain jobs are disappearing while new categories of work are expanding.
Employees with skills connected to artificial intelligence, cloud platforms, cybersecurity and data systems may benefit from this transition. Workers in support, administration, middle management and traditional software roles may face greater uncertainty.
Companies frequently present AI-related restructuring as evidence that they are becoming faster and more efficient.
However, investors do not always respond positively. Businesses that cited AI as a factor in layoffs reportedly underperformed the Nasdaq during the month following their announcements.
This suggests that markets may be sceptical when executives use artificial intelligence to explain job cuts. Investors may want clearer evidence that smaller workforces will produce sustainable growth rather than short-term cost savings.
AI can improve productivity, but large-scale restructuring can also disrupt operations, weaken employee morale and eliminate valuable institutional knowledge.
The layoffs announced in 2026 indicate that artificial intelligence is no longer only a product development priority. It is becoming a major influence on corporate structure and employment strategy.
Companies are using AI to automate tasks, reduce management layers and redesign how teams operate. At the same time, they are spending billions of dollars on computing infrastructure and competing for specialised talent.
For technology workers, the transition creates both opportunity and risk. New jobs are emerging in AI development and infrastructure, but established roles are being reconsidered across nearly every corporate function.
The long-term impact will depend on whether companies use AI primarily to reduce headcount or to create new products, services and employment opportunities.
What is already clear is that artificial intelligence has moved from an experimental technology to a central force shaping the future of work.
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