Not AI-driven: Etsy to lay off 12% of its workforce

Goyal recognised that AI is changing how the company is working, including the skills that they require.

“As the tools available to us evolve, the skills we need, the ways we work together, and the capabilities we build across Etsy must evolve as well,” she said.

“Our goal is to bring together the right team and the right technology to deliver for our community for the long term.”

The real reason behind the layoffs

The retrenchment announcement comes despite the progress it reported in its financial results. Its latest shareholder letter indicated that all key performance indicators show “improving momentum.”

“Second quarter GMS (Gross Merchandise Sales) and revenue growth accelerated on a sequential basis, and we delivered healthy flow-through of revenue growth to adjusted EBITDA, again demonstrating the strength of our business model,” its report read.