Groupon is trimming up to 400 positions worldwide as it doubles down on an artificial intelligence makeover, a move that will hit both employees and contractors while freeing up cash for new tech, marketing and higher-paid specialists. Company leaders are framing the move as a necessary step to turn the long-running deals marketplace into an AI-native operation, even as hundreds of people now face the prospect of losing their jobs.
On May 21, the board signed off on an initial restructuring plan that could wipe out as many as 400 roles, with most of those cuts expected by the end of the third quarter, according to the company's Form 8-K. Groupon expects to book pre-tax charges of $7 million to $13 million, largely tied to severance and benefits. In return, it is projecting $20 million to $25 million in annualized cost savings, with $10 million to $12 million of gross savings forecast for 2026. Up to half of those 2026 savings are earmarked to be reinvested into marketing, AI infrastructure, and what the company calls “talent density,” and Groupon cautions that the pace of reductions will depend on local legal rules and consultation processes in different countries.
Why Groupon Is Reshaping
Inside the company, the restructuring carries a code name: “Project Foundry.” The initiative is focused on embedding AI agents across teams and automating routine tasks that currently require human labor. In a May 7 shareholder letter, CEO Dusan Senkypl said Groupon is “rebuilding Groupon as an AI-native company,” according to the firm's Q1 investor release. Executives say the long-term bet is that smarter tools will let Groupon reach more merchants faster and scale the marketplace without growing headcount at the same pace.
Local Impact in Chicago
Groupon is headquartered in Chicago, where the cuts will land close to home. The company reported about 1,734 employees as of December 31, 2025, so a 400-job reduction would represent roughly 23 percent of its global workforce. That headcount appears in Groupon’s most recent annual SEC filing (Form 10-K). Local business outlets quickly spotted the implications, with Crain's Chicago Business reporting that the layoff plan stems from the board-approved restructuring announced May 21.
What Workers Should Know
For workers, the coming months will likely be a swirl of notices, internal memos and hard choices. Employees are being advised to keep an eye out for WARN notices, severance terms and other official communications as the plan rolls out. In the United States, the federal WARN Act generally requires larger employers to provide 60 days' advance notice before a mass layoff or plant closing, according to the Department of Labor's DOL WARN Advisor. In some international markets, affected workers may also have rights to consultation periods or additional protections under local labor law.
Market Reaction and Guidance
Wall Street, meanwhile, gave a tentative thumbs-up. Coverage noted that Groupon's stock jumped about 5 percent after the restructuring disclosure, and the company raised its full-year adjusted EBITDA outlook. Market reports also highlighted that Groupon expects the first phase of the plan to generate roughly $5 million in net savings in 2026 after its planned reinvestments, according to Investing.com. At the same time, leadership changes are underway: Bloomberg Law reported that Chief Operating Officer Jiri Ponrt has notified Groupon that he will resign effective July 10, a move that was also disclosed in the company's filings.
Groupon is pitching the restructuring as the logical next step in an AI-first strategy, with executives signaling that more automation and cost-cutting efforts could follow under Project Foundry. Industry coverage has framed the layoffs as part of a broader tech trend of using staff cuts to fund AI investments, per PYMNTS. The company says this initial phase should be largely complete by the end of the third quarter, while leaving the door open to additional moves that could extend into 2027.
