Realignment: AI translation service DeepL lays off 250 employees

“Today we are reducing DeepL’s total workforce by approximately 250 positions,” DeepL CEO and founder Jaroslaw Kutylowski wrote in a post on LinkedIn yesterday. That corresponds to around a quarter of the workforce. The startup, founded in 2017, is planning a strategic realignment, with the focus on AI: In the future, the startup will rely on smaller teams with a sharper focus. While employees should concentrate, among other things, on developing creative ideas, AI should take over routine tasks and be embedded in all company processes.

The news apparently came as a surprise to employees, as one DeepL employee wrote on LinkedIn: “It was a shock for all of us.” When asked by , the company did not answer which employees were affected and how long the company had been planning the job cuts and referred to the official press statement and Kutylowski’s LinkedIn post.

Doubts about the company’s financial planning

With its translation service, the Cologne startup was long considered Germany’s AI hope and was able to hold its own against US competitors such as Microsoft, Google and OpenAI. In the last major financing round in 2024, the startup, founded in 2017, was valued at around two billion US dollars.

Speculation about a possible US IPO this year also circulated last year; according to Bloomberg, the targeted valuation was up to five billion US dollars.

However, there were already doubts about the company’s financial planning in April of this year. According to a report in the Handelsblatt, DeepL is said to have achieved a negative operating result (EBIT) in 2023; the article refers to DeepL’s presumed financial planning. There will probably be a loss in EBIT in the coming years as well.

Greater focus on speech-to-speech translations

According to Kutylowski’s LinkedIn statement from yesterday, the company now wants to work even harder on its product portfolio: DeepL has recently started offering its customers not only translations in text form, but also real-time translations, from language to language, so to speak. In the future, DeepL wants to work more intensively on this – also with support from the USA.

The US company Mixhalo is to be involved. The company is also opening a location in San Francisco. The company also launched an autonomous AI agent last year, positioning itself in a new, highly competitive business area.