Something strange is happening in tech right now. Companies are posting record profits and revenue while laying off tens of thousands of people — and citing AI as the official explanation. So far in 2026, there have been an estimated 363 layoffs at tech companies, affecting nearly 150,000 people — a pace of about 974 people per day, 44% faster than last year — according to TrueUp, a tech job board and recruiting platform that runs one of the most widely cited tech layoff trackers.
Tech layoffs hit their highest single month in two years last month, with nearly 40,000 cuts. AI was the most-cited reason for layoffs across every industry for the third month running, according to outplacement firm Challenger, Grey & Christmas.
Yet there's growing skepticism that AI is really the culprit — that it's more of a convenient cover story than the actual cause. Few examples illustrate the pushback better than what happened at payments company Block earlier this year. After getting hammered for laying off nearly half the company, Jack Dorsey denied the cuts were a sign of trouble, insisting instead that AI tools “are enabling a new way of working which fundamentally changes what it means to build and run a company.” He also acknowledged, when pressed by commenters on X about the bloat he'd created during the pandemic, that Block had, in fact, over-hired.
Other voices have begun to weigh in, including famed venture capitalist Marc Andreessen, who recently called AI the “silver bullet excuse” for layoffs that are really about pandemic-era overhiring. In conversation with podcaster-investor Harry Stebbings, Andreessen said, “Essentially, every large company is overstaffed. It's at least overstaffed by 25%. I think most large companies are overstaffed by 50%. I think a lot of them are overstaffed by 75%. Now they all have the silver bullet excuse: Ah, it's AI.”
What happened earlier this month at Uber captures the ambiguity well. The company cut about 23% of its people division — HR and recruiting — affecting less than 1% of its 34,000 employees, it said. A company spokesperson specified that the cuts had nothing to do with AI. But the announcement came roughly one month after Uber's CTO revealed that the company had burned through its entire 2026 AI coding budget in four months and had to cap individual engineers' spending on tools like Cursor and Claude Code. Whatever Uber said publicly, people are connecting those dots.
What makes this combustible: at the very moment tens of thousands of workers are being shown the door, a small cohort of AI insiders is becoming wealthy on a scale that's hard to comprehend.
Early last month, AI chipmaker Cerebras Systems closed its first day on the Nasdaq up 68% from its $185 IPO price, giving the chipmaker a market cap of roughly $67 billion — the largest US tech IPO since Snowflake's 2020 debut. By the close, co-founders Andrew Feldman and Sean Lie were billionaires. (The company's shares have since fallen 30%.)
SpaceX, meanwhile, went public on Friday and, as of this writing, enjoys a $2.1 trillion market cap. That turned Elon Musk into a paper trillionaire and potentially minted an estimated 4,400 millionaires, with around $... [full content truncated at provided input]
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