Snap will lay off 10 percent of its global workforce, totaling around 500 employees.

The social-media company has cut workers before; in August 2022, for example, it reduced its headcount by roughly 20 percent as part of a broader restructuring. “We are reorganizing our team to reduce hierarchy and promote in-person collaboration,” a Snap spokesperson told Axios about the current layoffs.

These latest cuts come just as other prominent tech companies, including Google and Amazon, collectively lay off thousands of employees. According to layoffs.fyi, startups also cut back throughout January 2024. This is a reversal from the final months of 2023, when layoffs (and the number of companies laying off workers) seemed on a steady decline.

What’s behind the cuts? Many companies are still adjusting their respective headcounts after the turbulence of the past few years. During the pandemic, tech companies’ revenues surged as clients and consumers turned to cloud-based services while working remotely, leading to accelerated hiring. However, growing fears of recession and declining revenues subsequently led many of these tech companies to cut just as quickly as they’d hired; at the end of 2022 and the beginning of 2023, some of the country’s biggest tech giants collectively laid off tens of thousands of workers, while many startups outright collapsed.

Although the economic situation seems more solid than it did a year ago, many tech companies are trying to free up cash to invest in expensive, cutting-edge initiatives such as generative artificial intelligence (A.I.). Some of these initiatives could have the side effect of keeping some teams permanently lean; for example, a company’s executives might think a code-writing generative A.I. tool can save them from backfilling empty roles on a development team. However, it remains to be seen how many of these expensive, highly experimental efforts will ultimately pay off.