The online marketplace is based in New York and has offices in Dublin, London and Mexico City.

Online marketplace Etsy will lay off around 220 people to reduce its headcount by 12pc to a total of around 1,600.

The role reductions will cost the company about $35m in severance and associated costs and will be completed by the end of the third quarter of the year, according to Etsy.

CEO Kruti Patel Goyal said most of the restructuring would be concentrated in the company’s product and engineering group.

“We are changing our structure, with fewer silos to reduce handoffs and flatter, faster teams built to solve broader, more complex problems,” she wrote in a letter to shareholders yesterday (5 August) alongside Etsy’s second-quarter financial results.

“This is not a cost-cutting move; it is meant to lean in during a period of strong momentum so that we can move faster and execute with even greater focus.

“We are deeply grateful to our departing colleagues for their service, dedication and contributions, and we are committed to supporting them through this transition with care and respect.”

The company stated that “all key performance indicators continue to show improving momentum” in delivering its financial results for Q2.

CFO Lanny Baker said Etsy would “expect the restructuring to lower operating costs in the near term”.

He added: “Our objective in the restructuring is not only to extend the expense discipline we’ve demonstrated historically, but also to position ourselves to build the organisation necessary to execute our strategy and accelerate growth in the years ahead.

“Specifically, we intend to deepen our expertise in strategically critical areas across product, engineering and customer operations, with a particular focus on expanding and strengthening our team’s machine learning skills.”

Reuters reported that in a memo to employees, Goyal said the job cuts were not driven by AI, while adding that “AI is changing how all of us work, and it will continue to change how we build products and solve problems”.

“As the tools ​available to us evolve, ​the skills ⁠we need, the ways we work together, and the capabilities we build across Etsy must evolve as well,” she said.

Etsy, founded in 2005, is based in New York and has offices in Dublin, London and Mexico City. SiliconRepublic.com has requested information about which locations may be affected by the layoffs.

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