WordPress Maker Automattic Announces 16% Staff Layoffs

Automattic Announces Workforce Reduction

Automattic, the parent company of popular online platforms such as WordPress.com, Tumblr, and WooCommerce, is implementing a reduction in its workforce. A recent blog post published by Automattic on Wednesday detailed that these layoffs will affect 16% of the company’s employees across various departments.

Layoff Numbers and Context

Prior to the workforce adjustments, Automattic’s website indicated a total of 1,744 employees. This suggests that over 270 individuals may be affected by these changes. While Automattic did not officially confirm this figure, reports indicate the actual number of impacted employees was 281.

The decision to restructure, as explained in the post and communicated to employees via Slack, stems from the increasingly competitive market landscape and the rapid pace of technological advancements.

Recent Challenges for Automattic

This move follows a challenging period for Automattic, including a contentious legal dispute with web hosting company WP Engine. This ongoing conflict previously resulted in the resignation of some Automattic personnel last autumn.

Matt Mullenweg, CEO of Automattic, expressed his belief that WP Engine’s contributions to the open-source WordPress.org project were insufficient. He also argued that the use of the “WP” branding created confusion among consumers regarding its relationship to the core WordPress platform.

Goals of the Restructuring

According to Mullenweg’s announcement, the layoffs are intended to enable Automattic to become “more agile and responsive” to market demands.

The restructuring aims to “break down silos that have created inefficiencies,” enhance “focus on product quality,” and “ensure a viable financial model for long-term success.”

Mullenweg stated that improving productivity, profitability, and investment capacity are crucial for supporting customers and products.

Support for Impacted Employees

The workforce reduction will impact employees in 90 countries. Affected individuals will receive a severance package and assistance with job placement, among other support measures.

Mullenweg conveyed his confidence in Automattic’s future, stating, “I’m confident we will come out of this situation in a better position, poised to create a vibrant, profitable, well-designed company that will continue our mission to democratize the internet.”

Immediate Impact and Further Details

Sources at TechCrunch reported that the layoffs were implemented immediately, with employees receiving notification and subsequent loss of access to Slack. The changes included the departure of long-tenured employees with over a decade of service.

Additionally, Automattic has cancelled its annual “Grand Meetup” company retreat scheduled for 2025.

Departmental Impact and Severance Information

Reports indicate that approximately 100 of the layoffs originated from the WooCommerce organization. Other impacted areas include Tumblr, Day One, and the company’s AI divisions. (Layoffs within the Day One team exceeded 16%, with one source describing the organization as being significantly reduced.)

In the U.S., roles affected spanned account executives, marketing, product management and design, sales, community engagement, business operations, and advertising (leaving 16 out of 50 positions). The initial severance package offered was reportedly nine weeks, though this varied based on local regulations.

Automattic later refuted the accuracy of the nine-week severance figure.

A company statement clarified, “The public statements regarding the size of the severance packages are not true.” The statement affirmed Automattic’s commitment to handling all employment matters with integrity and fairness, and expressed gratitude to departing employees.

Sarah Perez can be reached at @sarahperez.01 on Signal and sarahp@techcrunch.com. This article has been updated to include additional details and a statement from Automattic regarding severance packages.