Companies that have linked workforce reductions to artificial intelligence have not consistently seen gains in their stock prices, according to a new analysis of S&P 500 firms. CNBC examined 23 companies across various sectors that explicitly cited AI or automation when announcing layoffs, finding that 13 of them, or 56 percent, saw their shares trade lower as of May 15. The average decline for those stocks reached about 25 percent.
Footwear giant Nike provides one clear example. The company cut nearly 800 workers in January as part of a plan to accelerate automation at its U.S. distribution centers. By mid-May, Nike shares had fallen nearly 35 percent from the announcement date. Salesforce followed a similar path after slashing 4,000 positions in September, pointing to its AI-powered customer service bots known as Agentforce. The stock has dropped about 32 percent since then.
Online marketplace Fiverr took an even sharper hit. In September the firm laid off 30 percent of its staff to become what CEO Micha Kaufman described as an AI-first company that's leaner, faster, with a modern AI-focused tech infrastructure. From that point through May 15, Fiverr shares plunged 54 percent.
Daniel Keum, associate professor of management at Columbia Business School, told CNBC that the pattern reflects broader uncertainty among investors. AI represents what he called a macro shock with unclear mid- to long-term effects. Keum noted that while companies are using the technology primarily to cut labor costs, competitors are doing the same, which shifts the baseline without necessarily improving profitability for any single firm.
AI is sort of what we call a sort of macro shock. There's a lot of uncertainty in what it will do. No one really has a good grasp of its mid- to long-term impact.
Estimates suggest at least 112,000 job losses since the start of 2025 can be tied to AI adoption. A November study from the Massachusetts Institute of Technology found that AI can already perform the work of 11.7 percent of the U.S. labor market and potentially save companies up to $1.2 trillion in wages across sectors.
Yet investors remain skeptical about whether these moves represent genuine AI-driven strategy or simply rebranded cost cutting. Ally Warson, partner at the AI-focused venture capital firm UP.Partners, said the practice has earned its own term: AI washing. Companies may use the current narrative around the technology to explain workforce reductions that stem from other pressures.
Companies will leverage whatever is in the media or the accepted narrative to potentially cloak why or why not they may lay people off.
Keum pointed to additional factors complicating the picture, including geopolitical events such as the Iran war, President Donald Trump's tariffs from last year, and the ongoing unwinding of pandemic-era hiring. He said it remains difficult to isolate how much of any given layoff wave stems from AI versus these other shocks.
Noah Hamman, CEO and founder of investment management firm AdvisorShares, argued that layoffs alone will not satisfy investors. Attention has shifted toward how companies are spending on AI and whether those investments will generate real returns. Hamman cited Alphabet's Google as a positive case, noting that its Gemini generative AI tool has already lifted cloud revenue, improved search results, and increased user engagement.
Warson highlighted another area where AI appears to be creating value beyond simple head-count reduction. Physical AI applications in robotics are helping manufacturing, industrial, and construction firms handle dangerous tasks such as window washing and wind turbine inspections. These systems can reduce workplace injuries and associated costs, potentially improving operational efficiency.
The data from the 23 companies suggests that simply announcing AI-linked layoffs may not be enough to lift share prices over the longer term. Investors continue to weigh the technology's promise against execution risks and competing macroeconomic forces.
Analysts expect further scrutiny of AI spending as companies report quarterly results in the coming months. The focus is likely to remain on measurable productivity gains rather than workforce reductions alone.