The Kaipher Editorial Team 
Fiverr has announced that it will lay off approximately 250 employees—about 30% of its 762-person workforce—to accelerate its shift to an “AI-first company”. CEO Micha Kaufman described the move as a return to “startup mode,” with a leaner organization built around artificial intelligence.
The cuts span all departments at the Israel-based freelance marketplace but come alongside maintained guidance for Q3 and fiscal year 2025. Despite the reduction in headcount, Fiverr reaffirmed its revenue projections for Q3 of $105–110 million.
Kaufman emphasized that this transformation is not about adding more staff to an aging infrastructure but about simplifying systems developed over 16 years.
Strategic Pivot to AI Infrastructure
In an open letter to employees, Kaufman explained that Fiverr must “launch a transformation” to modernize its tech stack. The company’s existing infrastructure, he wrote, “requires fundamental changes rather than incremental additions.”
He stressed that the goal is to build a more agile, AI-focused platform—leaner, faster, and capable of supporting advanced AI agents and machine learning models. As Reuters noted, this mirrors efforts at other tech firms like Salesforce to automate operations through AI.
By centering its roadmap on AI, Fiverr aims to streamline product development and reduce technical debt that has accumulated over nearly two decades.
Financial Impact and Market Response
Following the announcement, Fiverr shares fell over 4% in aftermarket trading. The company plans to reinvest a portion of the cost savings into AI initiatives while allocating the rest to improve profitability.
Fiverr targets an adjusted EBITDA margin of 25% by 2026—one year ahead of its initial schedule—driven by lower operating expenses. For Q3 2025, management expects revenue between $105 million and $110 million, in line with prior guidance.
Analysts say the layoffs underscore investor confidence in Fiverr’s long-term AI strategy despite near-term headwinds.
AI Implementation Already Underway
Kaufman pointed to existing AI-powered products as proof of concept. The Neo feature leverages AI to match projects with freelancers more effectively, while Fiverr Go offers AI-assisted project scoping.
Customer support now uses machine learning to consolidate knowledge and slash response times, freeing human agents for complex issues. “AI can automate and streamline processes, liberate humans from manual tasks, and unlock new capabilities,” Kaufman wrote.
Departing employees will receive severance packages, extended healthcare, and career transition assistance, ensuring support through the company’s next chapter.
