GitLab is cutting 14% staff as it expands its platform to serve AI workloads

Developer platform GitLab has laid off about 14% of its workforce, about 350 employees, as part of a broader restructuring effort. detailed last month.

The company said in May that it would reduce its workforce as it exited 22 countries, flattened management layers, and invested in infrastructure to scale its platform and serve growing traffic from AI workflows, with a greater focus on research and development.

CEO Bill Staples said during a… Group call on Tuesday that agents’ workloads are putting more pressure on developers’ infrastructure than it was designed to handle. It’s not a problem unique to GitLab. The company’s competitor GitHub has the same Struggle To deal with the massive influx of AI-powered submissions that affected its runtime.

“Agents operate at machine scale, and they’re pushing competitors to the brink. This quarter we started rebuilding git generations to support the scale and features needed to grow 100x. This is a scale requirement that didn’t exist before and has become a real pain point for every team in their journey with agents,” Staples said.

The company has partnered with an unspecified AI lab to design and rebuild its infrastructure for AI workloads, as well as create APIs that are “optimized for agents to store and retrieve context, including code,” Staples said. It is also investing in orchestration tools to coordinate software development between AI agents and developers, building out a context layer, and integrating governance tools directly into its platform.

GitLab joins a number of technology companies such as Intuit, Amazon, roadblock, cisco, Cloudflare, dead, Microsoftand oracle Which laid off large numbers of employees, citing the need to make artificial intelligence a core part of its business. The technology industry has already cut more than 100,000 jobs this year. For statistaand is on track to outperform in 2024 and 2025 if the trend of layoffs continues.

The pattern is now familiar: Companies are reporting record revenues while simultaneously shrinking their workforces, with AI cited as the reason for growth and the justification for the cuts.

In fact, all of these companies have recently reported strong revenues and profits, indicating strong demand for AI products, services, or the infrastructure needed to run them, and GitLab is no exception.

Company Tuesday I mentioned First-quarter revenue was $264 million, up 23% from the prior year, and gross margins of 88%. It expects to incur between $30 million to $35 million in restructuring expenses as part of the effort.