WordPress Maker Automattic Lays Off 16% of Staff Amid Strategic Restructuring
April 2, 2025 – Automattic, the company behind WordPress.com, Tumblr, WooCommerce, and a suite of other digital services, has announced a significant reduction in its workforce, laying off 16% of its staff. The decision, detailed in a company blog post published earlier today, affects roughly 279 employees out of the 1,744 listed on Automattic’s website prior to the cuts. The layoffs, confirmed by CEO Matt Mullenweg, come as the latest chapter in a turbulent year for the company, which has faced legal battles, internal dissent, and now a push to streamline operations in a fiercely competitive tech landscape.
The announcement, shared simultaneously with employees via Slack, frames the layoffs as a “restructuring” aimed at enhancing agility and ensuring long-term viability. “The market is more competitive than ever, and technology is evolving at breakneck speed,” Mullenweg wrote. “To support our customers and products, we must improve our productivity, profitability, and capacity to invest.” The cuts span divisions and impact employees across 90 countries, with those affected receiving severance packages, job placement assistance, and extended benefits—a gesture Mullenweg called “a commitment to supporting our departing team members.”
This move follows a rocky period for Automattic. Last fall, a high-profile dispute with hosting provider WP Engine led to a legal showdown, with Mullenweg accusing WP Engine of exploiting WordPress’s open-source ecosystem without sufficient contribution. The feud saw Automattic briefly throttle development hours on WordPress.org from 4,000 to 45 per week—a 99% cut—before restoring efforts amid community backlash. The conflict also triggered an exodus of 159 employees (8.4% of the workforce) in October 2024, when Mullenweg offered a voluntary buyout of $30,000 or six months’ salary to dissenters, a move he later described as leaving him “lighter” despite the “sting” of each resignation.
The layoffs announced today mark a shift from voluntary departures to involuntary cuts, a decision that has sparked mixed reactions. Posts on X reflect a blend of sympathy and skepticism, with one user noting, “Bad day to be an Automattic employee while the decisions of MCM [Matt Mullenweg] continue to run the company into the ground.” Just months ago, Mullenweg had touted hiring and expansion plans post-buyout, making the 16% reduction a stark pivot. TechCrunch, which broke the story, reported that Automattic did not respond to requests for confirmation of the exact headcount affected, leaving the 279 figure an estimate based on prior staffing data.
Analysts see the layoffs as part of a broader trend in tech, where companies like Epic Games (16% cut in 2023), Snap (10% in 2024), and DigitalOcean (11% in 2023) have trimmed staff to refocus amid economic pressures and shifting priorities. For Automattic, the restructuring aims to “break down silos,” boost product quality, and secure a “viable financial model,” according to Mullenweg. The company’s portfolio—spanning WordPress.com’s hosting, Tumblr’s social platform, and WooCommerce’s e-commerce tools—remains ambitious, but recent challenges have exposed vulnerabilities in its distributed, open-source-driven model.
The WP Engine saga, while no longer a direct financial drain after a settlement in January 2025, left scars. Mullenweg had argued that WP Engine’s use of the “WP” brand confused consumers and that its 40-hour weekly contribution to WordPress.org was inadequate compared to Automattic’s efforts. The resolution saw WP Engine clarify its branding, but the episode fueled internal unrest and external criticism, with some in the WordPress community accusing Mullenweg of prioritizing personal vendettas over ecosystem health.
For those laid off, the severance package includes at least six months’ pay, health insurance continuation, and career support—a generous offer by industry standards, though it does little to soften the blow for a workforce once celebrated for its remote, global culture. “Automattic has multiple products with world-touching potential,” Mullenweg wrote, signaling a refocus on core offerings like WordPress.com and Jetpack, though specifics on which divisions bore the brunt remain undisclosed.
As the dust settles, the WordPress community and tech watchers are left questioning Automattic’s next steps. Will this slimmed-down operation regain its footing, or is it a sign of deeper struggles for a company built on the promise of open-source innovation? For now, the layoffs underscore a harsh reality: even giants of the digital world aren’t immune to the pressures reshaping the industry.