Stability AI Cuts 10% of Its Workforce Following the Controversial Exit of Its CEO

By Jace Dela Cruz

Apr 19, 2024 01:26 AM EDT

Artificial intelligence startup Stability AI has initiated a round of layoffs following the departure of its CEO, Emad Mostaque. 

According to CNBC, the move affects over 20 employees as part of a restructuring effort to streamline operations.

Technology Business

(Photo : Tung Nguyen from Pixabay)

Stability AI Lays Off 10% of its Global Workforce

As revealed in an internal memo obtained by CNBC, the decision to downsize the company's workforce came after a period of unsustainable growth for Stability AI. 

Stability's newly appointed co-CEOs, Shan Shan Wong and Christian Laforte, stepped into their roles following Emad Mostaque's exit. They emailed employees on Wednesday night to announce the layoffs and emphasize the need to "right-size" the business.

In the internal memo, Wong and Laforte said, "Those who are affected by this have been notified individually, and we will be supporting them throughout this period."

The layoffs represent approximately 10% of Stability's global workforce, with the majority of those impacted occupying operational roles within the company. Mostaque's departure from Stability was announced last month to "pursue decentralized AI," leaving Wong and Laforte to assume leadership responsibilities. 

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Emad Mostaque's Controversial Tenure at Stability AI

Emad Mostaque's tenure had been marred by controversy, including allegations of misleading investors about his academic credentials and the nature of a partnership with Amazon.

However, Mostaque defended himself, refuting several allegations and asserting the legitimacy of the partnership with Amazon Web Services (AWS). He clarified the "false accusations" regarding his education, explaining that he failed to attend his graduation ceremony but made arrangements to receive his degrees by post.

Stability AI is behind the popular Stable Diffusion text-to-image model. The company continues to operate normally and releases new products, such as developer application programming interfaces (APIs) for its Stable Diffusion 3 AI model.  

READ MORE: OpenAI Reveals Dangerous AI Voice-Cloning Tech But Won't Be Released Yet; Here's Why!

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