Canva says it is restructuring, which will impact 1,271 workers, or 22% of its workforce, as it merges its product, growth, and platform teams

Job cuts at Canva mean fewer product development resources for alternative design tools.

Canva announced a significant restructuring, impacting 1,271 employees, which represents 22% of its global workforce. The design software company is merging its product, growth, and platform teams into a single product organization and reducing management layers. This decision comes after a period of slowing growth, described by CEO Melanie Perkins as the "hardest moment" in the company's thirteen-year history. The move aims to return Canva to its roots of small, empowered teams. While some employees will be laid off, others may be asked to relocate to centralized hubs, with hybrid workers expected in the office two to three days a week starting January. Departing staff will receive comprehensive severance packages, including at least six months' salary, extended healthcare, and grants for new ventures.

The extensive layoffs at Canva signal a broader industry recalibration as hyper-growth phases for many software companies begin to wane. The consolidation of teams suggests a strategic shift towards greater efficiency and a sharpened focus on core product development, potentially in response to increased competition and evolving market demands. This restructuring could also indicate a move to streamline operations in anticipation of potential economic headwinds or a change in investor sentiment towards the SaaS sector.

The implications extend to the competitive landscape, particularly for companies like Figma, which have also faced valuation pressures. Canva's move to consolidate might necessitate a more aggressive product roadmap to reassert its market position and potentially signal a trend towards leaner, more focused operational models across the design and creative software industry.