Stability AI to Announce Layoffs, Major Restructuring Weeks After Audio Generation Tool Launch

Just weeks after launching a new artificial intelligence (AI) tool capable of generating audio from a text prompt, Stability AI is now planning a major restructuring alongside layoffs.

An internal memo leaked to the press suggests that the AI company will be making significant changes following the resignation of former CEO and founder Emad Mostaque.

Stability AI to Lay Off Employees to Cut Costs

According to an emailed memo sent by interim Chief Operating Officer Shan Shan Wong and Chief Technology Officer Christian Laforte, the planned layoffs come as the company works to cut costs.

"Following a review of the global team, we have determined the need to restructure parts of the business, which sadly means saying goodbye to some colleagues," the email reads.

A recent report from CNBC informs us that 10 percent of the company's total headcount, or more than 20 employees, was affected by the layoffs. "Those who are affected by this have been notified individually, and we will be supporting them throughout this period," the memo reads.

According to the company's LinkedIn profile, Stability AI currently employs 51 to 200 staff, confirming this in an October blog post as well.

(Photo : STEFANI REYNOLDS/AFP via Getty Images)

This photo illustration shows the DALL-E website reflected between a computer screen and cellphone in Washington, DC, on July 20, 2022.

Stability AI to Conduct Major Restructuring

"These decisions have not been taken lightly, and they are intended to right-size parts of the business and focus our operations, which is critical to setting us on a more sustainable path," Shan Shan Wong and Christian Laforte announced.

A report from the Financial Times, citing undisclosed sources, revealed that the company's monthly expenses stand at $8 million. Additionally, in November, it secured approximately $50 million in financing from Intel, while recording $3 million in revenue.

In early April, Stability AI introduced Stable Audio 2.0, an upgraded version of its text-to-music tool. This update significantly expands users' music creation capabilities by enabling them to generate tracks up to three minutes long at 44.1 KHz stereo.

(Photo : Image via Stability AI)

Stability AI introduces Stable Audio 2.0, enhancing text-to-music capabilities, enabling creation of three-minute tracks at 44.1 KHz stereo, expanding creative options for users.

The release of Stable Audio 2.0 coincides with more internal changes at Stability AI, notably the resignation of Ed Newton-Rex, the company's former VP of audio. Newton-Rex cited ethical concerns regarding the utilization of copyrighted materials for AI training as the primary reason for his departure.

Furthermore, Stability AI faces legal challenges, including a lawsuit filed by Getty Images in 2023. Getty Images alleges that Stability AI unlawfully used its copyrighted images to train Stable Diffusion, its text-to-image generator.

The company has recently announced the availability of Stable Diffusion 3 and Stable Diffusion 3 Turbo on the Stability AI Developer Platform API.

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