Bengaluru, Jan 27, 2026, 22:46 (IST)
- Pinterest will cut less than 15% of its workforce and reduce office space in a restructuring
- The company expects $35 million to $45 million in pre-tax costs tied to the plan
- Shares fell nearly 10% as investors weighed the AI-driven overhaul
Pinterest said on Tuesday it will trim less than 15% of its workforce and shrink office space as it redirects resources toward artificial intelligence (AI), sending its shares down nearly 10%. (Reuters)
The move underscores a new pressure point for ad-driven tech firms: they are spending heavily on AI, but markets want a clearer line to revenue. Analysts have warned that “AI” is not, by itself, a strategy investors will buy.
Job cuts tied to AI spending are turning up across the sector, even as companies still talk up hiring for new skills. Layoffs.fyi, a tracker of tech job cuts, lists 123,941 layoffs across 269 tech companies in 2025. (Layoffs)
Pinterest had 5,205 full-time employees as of September 2025, meaning the reduction could hit fewer than 780 roles, Reuters reported. The company did not give an exact number of positions.
In a filing, Pinterest said it expects $35 million to $45 million in pre-tax restructuring charges — one-time costs tied to the overhaul, before taxes — and said most of the charges should be cash expenses. It said it expects to complete the plan by the end of the third quarter ending Sept. 30, 2026. (Cloudfront)
The same filing said the restructuring is meant to support a set of “transformation initiatives,” including shifting staff toward AI-focused roles, prioritising AI-powered products, and speeding changes to its sales and go-to-market approach — how it sells and markets ads and tools.
Emarketer analyst Jeremy Goldman called the layoffs a sign of caution, saying “these cuts look more defensive than strategic,” without clearer proof that AI will lift revenue.
Danni Hewson, head of financial analysis at AJ Bell, pointed to investor scrutiny around AI budgets, saying firms have to show “their substantial spend on AI is not only worth it,” while cutting in other places to pay for it.
Pinterest also struck a more practical tone. “We are making organizational changes to further deliver on our AI-forward strategy,” spokesperson Tessa Chen said, adding the company plans to hire AI-proficient talent and provide separation packages and benefits for impacted staff. (The Verge)
Pinterest has been rolling out AI-linked tools, including a shopping assistant for product recommendations and an ad suite aimed at automating campaign set-up and management, Reuters reported.
The cuts come as Pinterest competes for digital ad budgets with TikTok and Meta’s Facebook and Instagram, and as advertisers lean harder into platforms that can promise reach and measurable results.
But the plan carries risks. Pinterest warned in its filing that costs could end up higher or lower than expected, the changes could hurt morale and retention, and the company might not be able to exit or reduce office space as planned — the kind of operational drag that can linger long after the initial layoff headlines.
