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Article: Atlassian follows Block’s footsteps and cuts staff in the name of AI

Impact Score

6 / 10

AI Summary (Processed Content)

Atlassian is laying off 10% of its workforce, approximately 1,600 employees, to reallocate funds toward investments in artificial intelligence, enterprise sales, and financial strengthening. The company's leadership stated this move is a proactive adaptation to heightened market expectations for software companies, despite the firm performing well.

This follows a similar, larger-scale layoff at Block, where CEO Jack Dorsey cited AI's potential to automate tasks as a key driver. Several venture capitalists had predicted AI would begin significantly impacting labor by 2026, a trend these layoffs appear to be confirming.

The main topics covered are corporate layoffs at Atlassian and Block, strategic reallocation of resources toward AI, and the broader impact of AI automation on the tech labor market.

Original URL

https://techcrunch.com/2026/03/12/atlassian-follows-blocks-footsteps-and-cuts-staff-in-the-name-of-ai/

Source Feed

TechCrunch

Published Date

2026-03-12 17:20

Fetched Date

2026-03-12 14:30

Processed Date

2026-03-12 14:34

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Present

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Raw Extracted Content

Australian productivity software company Atlassian held layoffs as the company looks to funnel more money into AI.
Atlassian announced it’s cutting 10% of its workforce, around 1,600 people, on March 11. The company said this decision allows it to spend more funds on AI, enterprise sales, and to strengthen its finances.
More specifically, Atlassian said that it’s doing well, but is choosing to adapt to market conditions.
“The bar for what ‘great’ looks like for software companies — on growth, on profitability, on speed, on value creation — has gone up,” Atlassian CEO Mike Cannon-Brooks wrote in a press release related to the layoffs.
TechCrunch reached out to Atlassian for more information regarding which types of roles were cut and what happens next.
This news comes just a few weeks after a similar, albeit more drastic, statement was made by Block CEO Jack Dorsey. In February, the payments company announced it was cutting more than 4,000 employees, nearly half of its 10,000 employees at the time.
Dorsey said the cuts were being driven by the fact that AI could automate a lot of the work these employees were doing and predicted that many other companies would come to the same conclusion.
Several enterprise-focused VCs predicted to TechCrunch that 2026 would be the year that AI would start to take a meaningful toll on labor.
So far, their prediction has come true.