Canva Layoffs: Canva is gearing up for a potential stock market listing, making the timing of the restructuring particularly significant for its financial outlook. (File Photo) Canva Inc. is planning a major organisational restructuring that will affect more than a fifth of its workforce, as the growing influence of artificial intelligence (AI) prompts the design software company to rethink its business model and team structure. At least 1,271 employees, representing 22 per cent of the company's workforce, will either lose their jobs, move into different roles or be relocated to central office hubs. Canva Chief Executive Officer Melanie Perkins communicated the changes to employees in a note published on the company's website on Wednesday, according to a Bloomberg report. The restructuring marks a major shift for the Sydney-based company, which operates an online platform used to create graphics, presentations and other visual content. The changes also reflect the mounting pressure on software companies as AI-powered tools transform how users access and develop digital products. The rapid advancement of artificial intelligence has raised concerns about the future of traditional software businesses. Tools such as Anthropic PBC's Claude are changing how people complete tasks, potentially reducing their dependence on specialised software applications. The technology is also allowing businesses to automate more activities and operate with leaner teams, creating pressure on companies to reassess their workforce requirements and organisational structures. Explaining the need for significant changes, Perkins wrote, "New technology is transforming what people can create, how they create it, and what they expect from the products they use," Perkins wrote in the note. "I’ve come to the difficult conclusion that small changes won’t be enough." Although the company has not disclosed the exact number of employees who will be laid off, the announcement comes after Canva experienced a slowdown in growth for the first time in a decade. Perkins, who established the company alongside Cliff Obrecht and Cameron Adams, said the business needs a more streamlined operating structure. The proposed changes will focus on smaller teams with greater autonomy and fewer narrowly defined specialisations. Describing the scale of the changes, she called the reorganisation "the hardest moment in our 13-year history." Alongside the workforce changes, Canva is planning to bring more of its product teams together in Sydney, making the Australian city a central hub for its operations. The company also intends to increase in-person collaboration among employees. Starting January, most staff following a hybrid working arrangement will be expected to spend between two and three days each week in the office. The shift towards smaller, empowered teams is expected to simplify decision-making and reduce organisational complexity as the company adapts to the changing technology landscape. The restructuring comes at a time when AI adoption is prompting businesses across the global software industry to reconsider their hiring strategies, product development priorities and long-term growth plans. Canva's Journey: From A Simple Design Idea To A Global Platform