Sydney-based Canva is laying off 22% of its workforce as it reports its first major growth slowdown in a decade. The design software giant has lowered its 2026 revenue growth forecast to 20%, down from 30%, as it shifts from aggressive expansion to operational efficiency.
Canva, the Sydney-based design software giant, has announced a significant restructuring, resulting in the loss of 1,271 jobs. This reduction represents 22% of its global workforce. The company, which has been a prominent player in the design space, is facing its first meaningful growth slowdown in ten years, prompting a shift in strategy toward long-term operational efficiency.
As part of this organizational shift, the company is cutting its revenue growth forecast for 2026 from an initial target of 30% down to 20%. CEO Melanie Perkins described the move as a necessary step to 'refound' the company into smaller, more empowered teams. To streamline operations, Canva is merging its product, growth, and platform divisions, aiming to reduce internal complexity. Additionally, the company is instituting a return-to-office mandate, requiring hybrid staff to work from offices at least two to three days a week beginning in January 2027.
The decision reflects a broader trend among major technology firms that are prioritizing profitability and efficiency over the aggressive, unchecked hiring cycles that characterized the post-pandemic years. Other Australian technology companies have undergone similar restructurings; for example, Atlassian cut 1,600 positions earlier this year to reallocate capital toward AI research, and WiseTech Global reduced its workforce by nearly one-third in February.
For the broader technology sector, Canva’s move highlights increasing competitive pressure. The company is facing stiff rivalry from both incumbents like Adobe, Google, and Microsoft, and a new wave of AI-native design tools. These competitors are investing heavily in 'frontier models' that can automate complex graphic tasks, forcing private software companies to manage higher operational costs. Managing these costs while maintaining user retention is now a critical challenge for the firm.
Although Canva remains a privately held company and is not listed on public stock exchanges, this restructuring impacts investor sentiment regarding the broader tech ecosystem and upcoming IPO pipelines. Secondary market signals have recently shown signs of cooling compared to earlier private valuations of $42 billion, suggesting that the era of hyper-growth at any cost is facing a reality check. Investors should monitor whether these operational changes can restore growth margins, as the timing of any potential public listing remains uncertain given the current volatility in the global software industry.