Home interiors platform Livspace has laid off around 1,000 employees — nearly 12% of its workforce — as part of a phased internal reorganisation aimed at becoming an “AI-native organisation”.
While the company maintained that 12% of staff were impacted, reports suggest the actual figure could be higher.
AI-led restructuring
In an official statement, Livspace described the move as a “strategic reallocation of resources” rather than a reactive cost-cutting exercise. The company said it has integrated advanced AI agents across core functions including sales, design, operations and marketing.
According to Livspace, several tasks previously handled manually are now automated. The transition reportedly took place over six months, with systems tested gradually to maintain service quality as roles were phased out.
Funding pressures and profitability questions
However, the workforce reduction comes against a backdrop of limited external funding over the past four years and the absence of a clearly defined path to profitability.
Founded in 2014, Livspace has raised over $450 million from investors such as KKR, Jungle Ventures and Venturi Partners. It achieved unicorn status in 2022 after raising $180 million in a funding round led by KKR.
For the financial year ending March 2025, the company reported revenue of ₹1,460 crore and narrowed losses by 42%.
Leadership transition
Alongside the restructuring, co-founder Saurabh Jain has stepped down after 11 years with the company.
Livspace previously cut 2% of its workforce in 2023 and laid off around 450 employees during the Covid-19 pandemic in 2020.
While the company positions the latest move as AI-driven transformation, analysts note that funding challenges and long-term sustainability concerns appear to be significant contributing factors.