The news: eBay plans to lay off roughly 9% of its workforce, or about 1,000 employees, a move first reported by Reuters and later confirmed by a company spokesperson.

That marks the second round of layoffs for the company this year. eBay previously laid off about 800 employees, or 6% of its headcount, in February.

How we got here: The decision to trim staff is notable because, as CEO Jamie Iannone said in a memo to staff, eBay’s “strategy is working” and there is “significant opportunity ahead” for the company. Both revenues and gross merchandise value (GMV) rose 15% YoY in Q2, while focus category GMV—which includes collectibles and trading cards, motor parts and accessories, fashion, and refurbished goods—grew even faster, at 26% YoY. At the same time, investments in live shopping are bearing fruit, with eBay Live GMV up roughly eightfold YoY, as the format helps deepen engagement, promote discovery, and drive sales across the rest of eBay’s platform.

But the company is positioning the layoffs as a necessary step to better align its resources with its top strategic priorities. The downsizing could also enable eBay to offset some of the expenses tied to its Depop acquisition, which ended up costing $200 million more than the $1.2 billion initially announced.

Implications for retail: eBay’s decision to embark on layoffs despite its position of relative strength could reflect caution in an uncertain environment for consumer spending. While we expect the company’s US retail ecommerce sales to rise 25.7% this year, we also expect that momentum to slow sharply over the next two years while eBay’s share of total online sales stagnates. Reducing headcount now could enable the company to preserve resources that could be used to fund another acquisition or pursue other growth opportunities.

eBay didn’t explicitly refer to AI in its announcement, but the technology could be a factor in the decision to downsize. While the company has mostly spoken about its efforts to use AI to make life easier for buyers and sellers, executives have also touted AI’s ability to unlock efficiencies within its organization—such as the ability to produce creative at a much lower cost. Those gains could be fueling confidence in its ability to operate effectively with a smaller workforce.

This content is part of EMARKETER’s subscription Briefings, where we pair daily updates with data and analysis from forecasts and research reports. Our Briefings prepare you to start your day informed, to provide critical insights in an important meeting, and to understand the context of what’s happening in your industry. Non-clients can click here to get a demo of our full platform and coverage.