The company replaced 700 employees with AI, and two years later, with the lack of artificial intelligence, it is retraining humans
AI-led cuts lead to performance issues
Over the past two years, Krana has partnered with OpenAI to reduce its staff and automate several features. By 2023, the company suspended hiring and moved most of its customer service efforts to AI. As AI handles tasks such as translation, art production, and data analytics, this move can save a lot of money, including $10 million in marketing.
Despite this shift, CEO Sebastian Siemiatkowski acknowledged that the quality of work done by AI agents did not meet expectations. “From a brand perspective, the company’s perspective, I just think it’s so crucial that you know clearly to the customer that there will always be humans if you want to,” Siemiatkowski said. “Unfortunately, the cost seems to be the main evaluation factor when organizing this task, with a lower quality in the end.”
The company believes that the labor force has declined
Klarna’s IPO prospectus filed in March showed a significant reduction in staff. The company had 5,527 full-time employees at the end of December 2022, and by December 2024, the employee dropped to 3,422. Even in December 2024, Simiyatkovsky said: “AI can already do all our work like humans.”
Other companies follow a similar path
Klarna uses AI to lay off employees, which reflects a larger trend in the technology and finance industries. Earlier this month, cybersecurity company CrowdStrike announced it would reduce its workforce by 5% to replace the role of AI. Duolingo, a language learning application, has also begun to reduce its reliance on contractors, noting that AI will take over certain tasks. The company said it took a similar approach when it focused on mobile platforms in 2012. It plans to automate performance reviews and limit employee growth to teams that cannot further automate their operations.
Microsoft pays 6,000 as AI deepens
Microsoft has laid off about 6,000 employees, accounting for nearly 3% of the global workforce, one of the largest layoffs to date. The decision was made as the company expanded the use of artificial intelligence in its products and services.
Those affected include Gabriela de Queiroz, director of artificial intelligence at Microsoft for Startups. “I’m affected by Microsoft’s latest round of layoffs. Am I sad? Absolutely. I’m sad to see so many talented people and I’m honored to be let go,” she wrote in a social media post.
More than 40% of the layoffs in Washington State come from the software engineering team, according to a Bloomberg report. Layouts affect employees at different levels and across the globe as Microsoft reorganizes to reduce management.
Although told to stop working immediately, de Queiroz said she stayed longer to attend the meeting and said goodbye. “This is right for me,” she noted in the post.
The company’s strategic shift raises problems, as layoffs include roles in AI, even as Microsoft pushes wider adoption of the same technology. “You are not alone for those who are affected too. We are at least 6,000.”
