Atlassian lays off 1,600 employees, including in India, as it ramps up AI investment

Atlassian has announced significant layoffs affecting around 10% of its workforce, translating to approximately 1,600 employees. This strategic move, highlighted by CEO Mike Cannon-Brookes, is part of the company's ongoing transition towards investing more heavily in artificial intelligence and enhancing enterprise sales. In a message shared with staff, Cannon-Brookes conveyed the challenging nature of this decision, stating, "I have made the incredibly difficult decision to reduce the size of our team by ~10%." Employees were informed that they would soon receive emails detailing whether they were impacted by the layoffs or would enter consultations regarding their positions. The layoffs predominantly affect North America, which accounts for about 40% of those let go, followed by approximately 30% in Australia and around 16% in India. Cannon-Brookes explained that these changes are designed to facilitate funding for new investments in AI and improve the company's overall financial health. In addition to the layoffs, Atlassian is restructuring its operations around a framework it refers to as the “System of Work,” aimed at accelerating its response to evolving demands in the software landscape. "We’re also changing the way we work to move faster," Cannon-Brookes noted. The company also revealed that Rajeev Rajan will resign from his position as Chief Technology Officer, effective March 31, 2026, after nearly four years. These layoffs come amid a broader trend where tech firms are ramping up their investments in AI technologies while seeking cost efficiencies in other areas. Cannon-Brookes acknowledged the emotional toll of this decision on employees, stating, "I believe this is the right decision for Atlassian. But that doesn’t mean it’s easy. Far from it. I know this has a huge impact on each of you, and it weighs heavily on me and Atlassian today." To assist those affected, Atlassian will provide a comprehensive separation package, including a minimum of 16 weeks of severance pay, additional compensation based on tenure, prorated bonuses for the fiscal year 2026, and healthcare coverage for up to six months for eligible employees and their families. The company will also offer career transition services and support for those seeking new roles or needing visa assistance.