Stability AI Lays Off Employees; Restructures After CEO’s Departure

Stability AI is laying off an unspecified number of employees as part of a restructuring process.

The company will hold a town hall meeting Thursday (April 18) and will notify the impacted employees individually, Reuters reported Thursday, citing a company memo and an unnamed source.

“These decisions have not been taken lightly and they are intended to right-size parts of the business and focus our operations, which is critical to setting us on a more sustainable path,” Interim co-CEOs Shan Shan Wong and Christian Laforte said in the memo, per the report.

The memo did not disclose the number of jobs being cut, according to the report.

The reported layoffs come weeks after the company’s founder, Emad Mostaque, resigned as CEO and a member of the board, and at a time when Stability AI is facing tough competition from OpenAI and Mistral, according to the report.

Mostaque stepped down from those positions on March 22, saying he aimed to pursue decentralized artificial intelligence (AI).

“I am proud two years after bringing on our first developer to have led Stability to hundreds of millions of downloads and the best models across modalities,” Mostaque said when announcing his resignation. “I believe strongly in Stability AI’s mission and feel the company is in capable hands. It is now time to ensure AI remains open and decentralized.”

When Stability AI announced Mostaque’s resignation on March 23, the company said it was searching for a permanent CEO and preparing for its next phase of growth.

“The leadership change marks an opportunity for Stability AI, the management team, board of directors and investors in a shared commitment to realize the shared vision for the company’s next stage of growth,” the company said in the announcement. “Together, we are committed to preserving the exceptional team, cutting-edge technology and vibrant community that’s been cultivated over the years, ensuring Stability AI remains a leader in open multi-modal generative AI.”

The reported layoffs also come a day after Stability AI announced the availability of its text-to-image generation system, Stable Diffusion 3 and Stable Diffusion 3 Turbo, on the Stability AI Developer Platform API.

The company also said Wednesday (April 17) that it has invited select users to participate in the early release of its Stable Assistant Beta, a chatbot that features Stable Diffusion 3.