--- title: "Canva cuts 22% of staff as AI costs bite; Adobe trades at 13.6 times earnings" description: "The challenger to Adobe's Creative Cloud is cutting, moving or relocating 1,271 people, 22% of its staff, after the cost of serving AI features forced a growth downgrade and a $7.1 billion valuation markdown. The incumbent still grows 12% a year and trades at 13.6 times earnings." publisher: "The Inference" section: "Policy & Labor" published: 2026-11-04T14:06:24.144Z modified: 2026-11-04T14:06:24.144Z canonical: https://theinference.org/article/canva-cuts-22-of-staff-as-ai-costs-bite-adobe-trades-at-13-6-times-earnings language: en keywords: "Canva, Adobe, Layoffs, AI Costs, SaaS, Valuation" --- # Canva cuts 22% of staff as AI costs bite; Adobe trades at 13.6 times earnings > The challenger to Adobe's Creative Cloud is cutting, moving or relocating 1,271 people, 22% of its staff, after the cost of serving AI features forced a growth downgrade and a $7.1 billion valuation markdown. The incumbent still grows 12% a year and trades at 13.6 times earnings. Canva, the [Australian challenger](https://theinference.org/markets/companies) to [Adobe](https://theinference.org/markets/companies/adobe)'s Creative Cloud, told staff on Wednesday that 1,271 people, 22% of its workforce, face layoffs, role changes or relocation to hubs centred on Sydney [1][2]. Chief executive [Melanie Perkins](https://theinference.org/markets/people), who co-founded the company, called it "refounding Canva" [2] and "the hardest moment in our 13-year history" [3], in [a note dated November 3](https://www.canva.com/newsroom/news/) [4] that never once uses the word AI, crediting only "new technology" [1]. Those leaving keep their laptops and at least six months of pay [1]. Squarespace announced 19% cuts a day earlier [2]; trackers count 139,004 tech jobs gone across 344 companies this year [5]. ## Too popular to afford The August paper trail explains the omission. Canva [cut its 2026 growth forecast from 30% to 20%](https://thenextweb.com/news/canva-valuation-cut-ai-costs-blackbird-airtree) after second-quarter revenue of $921.9 million, up 25.2%, missed internal guidance, on the soaring cost of running AI features on frontier models [6]. Demand, Perkins told Fortune, "significantly exceeded" expectations; Canva slowed the rollout rather than ship broadly "before the underlying economics were ready" [6]. Its longest-standing backers, Blackbird and Airtree, marked the company down 17% to $34.9 billion, and Canva's internal mark, the price at which staff can sell shares, fell from $38.9 billion to $31 billion [6]. PitchBook analyst Derek Hernandez gave the sector diagnosis: "AI is making SaaS no longer a zero marginal cost solution" [6]. ## The incumbent bleeds in its multiple, not its sales Adobe's filings show no collapse. Revenue rose in each of the past twelve quarters to a record $6.76 billion in [the quarter ended August 28](https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000796343), up 12.9% [8][9], and $9.3 billion of stock was bought back in four quarters [7]. The market still prices an AI threat the numbers do not show: [13.6 times earnings against a 22.8 median for the S&P 500](https://www.trefis.com/stock/adbe/articles/622286/what-is-going-on-with-adobe-stock/2026-11-03), after a one-year fall of 25.9% while the index returned 11.8% [7]. *Chart: **Adobe's revenue has risen every quarter for three years, to a record $6.76 billion** Line chart of Adobe quarterly revenue from Q4 fiscal 2023 to Q3 fiscal 2026, rising from $5.0 billion to a record $6.76 billion* *Quarterly revenue in billions of US dollars, Adobe fiscal quarters. Source: Adobe SEC filings. [9]* *Chart: **Adobe trades at 13.6 times earnings, a third of its 2021 multiple and below the S&P 500 median** Bar chart of price-to-earnings multiples: Adobe at 47.0 in September 2021, S&P 500 median at 22.8, Adobe at 13.6 in November 2026* *Price-to-earnings multiples: Adobe in September 2021 and November 2026 against the current S&P 500 median. Source: Trefis. [7]* The crack is real but narrow. AI-first subscription revenue, above $650 million and up more than 150%, is about 2.4% of Adobe's $27.5 billion total [7]; contracted-but-unbooked revenue grew 8%, its first single-digit rise since early fiscal 2023 [7]; and net income rose 3.1% against 12.9% sales growth last quarter [8]. Canva, for its part, claims free-cash-flow profitability on $3.5 billion of revenue, and Perkins cited no cash pressure [1]. Neither camp is cutting from distress; both are being repriced by the same bill. ## December decides Adobe's December report, its first under [Anil Chakravarthy](https://theinference.org/markets/people/anil-chakravarthy), who becomes chief executive on December 1 as [Shantanu Narayen](https://theinference.org/markets/people/shantanu-narayen) moves to executive chair, tests guided 10.2% growth in subscription value for fiscal 2026 [7]. Canva's staff all-hands lands November 10 [5]. Adobe has spent the autumn losing what the multiple was built on: [the executive who ran Photoshop left with no successor](https://theinference.org/article/the-executive-who-ran-photoshop-just-left-adobe-with-no-successor-and-no-reason) in September, and [OpenAI evicted Adobe from ChatGPT](https://theinference.org/article/evicted-openai-boots-adobe-out-of-chatgpt-while-its-own-kingdom-shrinks) weeks earlier. At Canva, the AI bill is being paid in jobs. At Adobe, so far, only in the multiple. ## Takeaway Canva cut 22% of staff after AI serving costs forced a growth downgrade, while Adobe grows 12% and trades at 13.6 times earnings; December's report under its new chief executive is the test. ## Sources 1. [The Register, "Aussie Adobe assailant Canva announces layoffs in re-org affecting 22% of staff", 4 November 2026](https://www.theregister.com/saas/2026/11/04/aussie-adobe-assailant-canva-announces-layoffs-in-re-org-affecting-22-of-staff/5307422) 2. [The Verge, Jay Peters, "Canva is announcing changes and layoffs affecting 22 percent of its staff", 3 November 2026](https://www.theverge.com/tech/1025971/canva-changes-layoffs) 3. [Live Mint (Bloomberg), "Canva layoffs: Over 1,200 staff to lose job, CEO Melanie Perkins calls it 'hardest moment in our 13-year history'", 3 November 2026](https://www.msn.com/en-in/news/other/canva-layoffs-over-1200-staff-to-lose-job-ceo-melanie-perkins-calls-it-hardest-moment-in-our-13-year-history/ar-AA2gIikU) 4. [Canva Newsroom, "An important update on our team", dated 3 November 2026](https://www.canva.com/newsroom/news/) 5. [BeInCrypto, "Canva's First Growth Slowdown in a Decade Triggers a 1,271-Role Restructure", 4 November 2026](https://beincrypto.com/canva-layoffs-restructure-1271-roles/) 6. [The Next Web, "Canva's backers cut $7.1bn from its valuation, and its own valuer cut more" (citing AFR and Fortune), 14 August 2026](https://thenextweb.com/news/canva-valuation-cut-ai-costs-blackbird-airtree) 7. [Trefis, "What Is Going On With Adobe Stock?", 3 November 2026](https://www.trefis.com/stock/adbe/articles/622286/what-is-going-on-with-adobe-stock/2026-11-03) 8. [24/7 Wall St., "The Software Monopoly Priced Like a Victim: Adobe", 26 October 2026](https://247wallst.com/investing/2026/10/26/the-software-monopoly-priced-like-a-victim-adobe/) 9. [Adobe, quarterly figures from its SEC filings, retrieved 4 November 2026](https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000796343) --- Canva cuts 22% of staff as AI costs bite; Adobe trades at 13.6 times earnings — The Inference. Canonical: https://theinference.org/article/canva-cuts-22-of-staff-as-ai-costs-bite-adobe-trades-at-13-6-times-earnings