eBay Cuts 800 Jobs While Betting Big on AI - The Brutal Math of Survival

800 people lost their jobs on Thursday. But eBay isn't struggling—it's reshaping itself for a battle it might already be losing. The e-commerce giant announced it's cutting 6% of its workforce while simultaneously pouring money into AI and spending $1.2 billion to buy Depop. The math is brutal, but it tells a story about survival in today's digital economy.

The Squeeze Play

eBay calls it "aligning structure with strategic priorities." Translation: we're being crushed by Amazon, Walmart, and a parade of flashier competitors like TikTok Shop, Temu, and Shein. The company's 12,300 employees worldwide just became 11,500, with cuts spread across every department.

The timing isn't coincidental. eBay just settled a harassment lawsuit with a Massachusetts couple who were stalked by former employees angry about their blog coverage. Two executives went to prison in 2022 over the scheme. Now the company is trying to turn the page with a very different kind of housecleaning.

The AI Gamble

Here's where it gets interesting: eBay is firing humans while hiring algorithms. The company has partnered with OpenAI to build an "agentic web browser" and is infusing AI across its buyer and seller experiences. Internal AI tools are already deployed, and more are coming.

It's a classic Silicon Valley move—cut costs on labor while betting big on technology. But unlike a pure tech company, eBay is a marketplace that depends on human trust and community. Can AI really replace the nuanced work of building relationships between buyers and sellers?

The Youth Problem

The Depop acquisition reveals eBay's real anxiety: it's losing the next generation. 90% of Depop's users are under 34, exactly the demographic that sees eBay as their parents' shopping site. CEO Jamie Iannone hopes the deal will boost eBay's fashion business, one of its fastest-growing categories.

But here's the catch—Depop thrives on authenticity and community, the opposite of eBay's increasingly automated approach. Will young users stick around once eBay's corporate machinery takes over?

Winners and Losers

The math is simple but harsh. eBay's "focus categories"—fashion, collectibles, car parts, and refurbished goods—grew 16% year-over-year in Q4. Investors love efficiency plays like this one. Stock price stability matters more than employee headcount.

For the 800 laid-off workers, the calculation is different. They're casualties of a strategy that prioritizes algorithmic efficiency over human expertise. Many probably helped build the platform that's now replacing them.

The Bigger Picture

This isn't just about eBay—it's about the entire e-commerce ecosystem. Every platform faces the same choice: automate or die. Amazon has been replacing warehouse workers with robots for years. Walmart is testing AI-powered stores. Even Etsy, known for its human touch, is experimenting with algorithmic recommendations.

The question isn't whether AI will transform e-commerce—it's whether companies can maintain their soul while feeding the machine.