Snap 's shares jumped on Wednesday after the company announced plans to slash up to 16% of its global workforce, citing AI-driven efficiencies.

CEO Evan Spiegel said in a letter to staff that the reduction would affect around 1,000 members of staff and that at least 300 open positions would be closed. The stock was last up 8.6% in premarket trading.

Snap, the parent company of popular messaging platform Snapchat, is planning to reallocate resources to its highest priority initiatives, including increasing its net-income profitability.

"Last fall, I described Snap as facing a crucible moment, requiring a new way of working that is faster and more efficient, while pivoting towards profitable growth," Spiegel wrote.

"We believe that rapid advancements in artificial intelligence enable our teams to reduce repetitive work, increase velocity, and better support our community, partners, and advertisers," Spiegel added.

"We have already witnessed small squads leveraging AI tools to drive meaningful progress across several important initiatives, including Snapchat+, enhanced ad platform performance, and efficiency improvements in our Snap Lite infrastructure."

In a presentation to investors, the company said it's being squeezed by giants with greater resources as well as fast-moving startups. In the face of rising competition, Snap said it aims to increase profitability via "AI-driven transformation," by augmenting workflows and having smaller teams.

The social platform plans to assign work to smaller, highly focused teams while increasing AI agent capabilities. It reported that AI agents are already generating over 65% of its new code and responding to over 1 million queries per month.