Home interiors platform Livspace has laid off at least 1,000 employees, or about 12% of its workforce, as part of a restructuring aimed at integrating artificial intelligence more deeply into its operations. The KKR-backed startup, which had about 7,000 to 8,000 employees before the cuts, has reduced headcount across functions including design, sales, operations and marketing, Moneycontrol reported, citing people familiar with the matter.

A company spokesperson confirmed the development, saying the move is part of a broader strategic shift.

“At Livspace, we’ve always been a technology-first company. As we look at the next phase of our growth, we are fundamentally reorganizing our internal operations to become an AI-native agentic organization,” the spokesperson said.

“To be clear, this isn't a reactive cost-cut. It’s a strategic reallocation of resources,” the spokesperson added.

The spokesperson said the company has integrated advanced AI agents and automation tools across its core functions. “In many areas, tasks that were previously manual are now handled by intelligent systems, while our existing teams are seeing their productivity supercharged,” the spokesperson told Moneycontrol.

This marks at least the second round of layoffs at Livspace in recent years. The company cut nearly 100 jobs in 2023 and more than 400 in 2020 as part of efforts to improve its financial performance.

According to figures cited by Moneycontrol, Livspace’s revenue rose 23% to 1,460 crore rupees ($175 million approximately) in the fiscal year ended March 2025, up from 1,185 crore rupees the previous year. Its losses narrowed to 242 crore rupees from 416 crore rupees during the same period.

In a parallel development, co-founder Saurabh Jain has stepped down from the company. Jain, who joined Livspace in 2015 after his startup DezignUp was acquired, was elevated to chief business officer in 2022.

“In tandem with our technological evolution, we are also seeing a natural transition in our leadership. After 11 remarkable years, our co-founder, Saurabh Jain, has decided to move on to pursue his personal interests,” the spokesperson said, according to Moneycontrol.

Founded in 2014, Livspace has raised more than $500 million and was last valued at over $1 billion.

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