Atlassian said on Wednesday that it’s eliminating 10% of its workforce, or about 1,600 jobs, as the company restructures following a plunge in its stock price driven by developments in artificial intelligence.

“We are doing this to self-fund further investment in AI and enterprise sales, while strengthening our financial profile,” CEO Mike Cannon-Brookes said in a blog post. He said employees would be notified of their status by email.

Atlassian has lost more than half its value this year alongside a broader selloff in software stocks brought on by concerns about the competitive threat of generative AI tools such as Anthropic’s Claude Cowork. The stock is down 84% from its peak in 2021. It had been a big winner during the Covid era as cloud-based collaboration tools surged in popularity with office workers stuck at home.

The cuts will result in $225 million to $236 million in charges and should be mostly done by the end of June, the company said in a filing.

The maker of Jira project tracking software has been trying to expand demand of its Rovo AI features, and in February the company touted 5 million monthly users. Atlassian offers Rovo credits in its subscriptions, and the company’s year-over-year revenue growth has accelerated for the past three quarters.

In 2023 Atlassian trimmed 500 employees, or 5% of its headcount.

In recent months, bosses have increasingly played up AI while saying they were lowering headcount. In February, Block’s Jack Dorsey announced that the payment company would lay off 4,000 employees as it seeks to put “intelligence” at the core of its operations.

This is developing news. Please check back for updates.