GitLab Cuts 14% of Staff and Exits 22 Countries in AI Pivot

GitLab is cutting 350 full-time employees, about 14% of its workforce, as part of a restructuring built around AI.

The maker of software development tools confirmed the cuts on 2 June, after telling staff in May that layoffs were coming as it removed management layers and reworked research and development.

GitLab is also exiting 22 countries, shrinking its geographic footprint by roughly 37%, with customers in those markets served through its partner network. The overhaul is on track to be completed by early next year.

The restructuring will cost between US$30m and US$35m in severance, termination benefits and retention costs, with roughly US$19m of that landing in the current quarter, which ends in late July.

Eight layers, sixty teams, one agentic bet

CEO Bill Staples first flagged the changes in a May memo to employees, reported by Business Insider. He framed the overhaul as preparation for what he calls the agentic era of software development. "Eight layers is too deep for a company our size," Bill wrote in the memo.

The plan strips out as many as three layers of management in some functions. Research and development is being reorganised into roughly 60 smaller teams, with affected employees given a window to apply for voluntary separation before final numbers were set.

"We are evolving GitLab to be the trusted enterprise platform for software creation in the AI era," Bill says in the company's announcement. GitLab joins a growing roster of software companies that have cut jobs while pivoting to make AI a central pillar of the business. 

GitLab joins a growing roster of software companies that have cut jobs while pivoting to make AI a central pillar of the business. Website builder Wix cut about 20% of its staff on 28 May, citing AI efficiencies among other pressures. Financial software group Intuit is cutting 3,000 roles, about 17% of its workforce, to refocus on AI.

The all-remote model meets a 22-country exit

The people challenge is amplified by how GitLab is built. The company operates all-remote, with employees spread across more than 60 countries before the restructuring. Exiting 22 of those jurisdictions means unwinding employment contracts under 22 different sets of notice periods and severance rules.

That complexity is partly why the restructuring charge stretches across four quarters rather than landing at once.

For HR leaders, the harder question is engagement. When the public framing of a restructuring is that AI has made roles unnecessary, the people who stay hear a message about their own future, too.

Retention costs built into the US$35m charge suggest GitLab knows it must pay to keep the people it wants through the transition.

Record results, deeper cuts

The first quarter for Gitlab ended 30 April, revenue climbed 23% to US$264.2m, beating analyst expectations of about US$254m. Subscription revenue jumped to US$239.3m from US$194.5m a year earlier, and the number of customers spending more than US$100,000 annually grew to 18%.

GitLab narrowed its loss to US$5m from US$35.9m a year earlier and raised the low end of its full-year revenue guidance, keeping a ceiling of US$1.12bn. 

Investors approved of the combination. Shares rose 7% to US$34.05 in extended trading after the 2 June announcement.

The defining workforce question of 2026

Gartner research published in May found that companies piloting AI cut jobs, whether or not the technology was generating returns. The cuts came first. The returns, if any, were expected to follow.

GitLab sits squarely in that pattern. The Q1 numbers say the existing workforce was delivering. The restructuring says the future workforce will look different anyway.

For the 350 people leaving and the thousands of HR leaders watching, the question is the same: the agentic era has arrived, and companies are restructuring for it before anyone fully knows what it requires.