AI-Focused Transformation: Grammarly Restructures, 230 Jobs Impacted

Grammarly announced this week the layoff of 230 employees worldwide. The company clarified that these adjustments are part of its strategic shift towards emphasizing the "AI-enabled workplace of the future."

CEO Rahul Roy-Chowdhury elaborated on the decision in a memo to employees, stating, "To arrive at today’s decision, we took a look at our organizational design and the current skillsets of our teams through the lens of our company strategy." He emphasized the necessity of aligning the company's capabilities with its focus on AI-driven technologies.

Roy-Chowdhury made it clear that the layoffs were not motivated by financial constraints, asserting Grammarly's strong financial position. The impact of these layoffs spans various functions and geographic locations within the company.

Affected employees will receive a minimum of three months' base pay along with applicable health insurance benefits, as outlined in the memo.

The memo also highlighted Grammarly's significant growth over the past five years, expanding its workforce from 200 to 1,000 employees. Roy-Chowdhury acknowledged the evolving industry landscape, citing global events and advancements in AI technology as driving forces behind the need for a more strategic approach.

Looking ahead, Roy-Chowdhury expressed optimism about Grammarly's future prospects, affirming the company's commitment to leveraging its foundation to deliver enhanced value to customers and actively shape the future of work through AI innovation.

Grammarly's announcement adds to a recent trend of layoffs within the tech industry. Several prominent tech companies, including Google, Microsoft, Snapchat, eBay, PayPal, DocuSign, Okta, Block, Discord, Twitch, and Duolingo, have undertaken similar measures in the past month.

In November 2021, Grammarly secured $200 million in funding, valuing the company at $13 billion. Roy-Chowdhury had indicated at the time that the funding would be directed towards further investments in AI technology.

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