VERSES AI Slashes Staff by Half in High-Stakes Survival Pivot

VANCOUVER, British Columbia – January 16, 2026 – VERSES AI Inc. (CBOE: VERS), a cognitive computing company developing agentic AI systems, today announced a dramatic corporate restructuring that includes laying off approximately half of its workforce. The move, which also involves temporary salary deferrals for some executives, is being framed by the company as a strategic refocus on its core markets and highest-priority initiatives.

In a statement, the company confirmed the workforce reduction is designed to “drastically reduce operating costs and improve the Company's liquidity position.” This painful measure signals a critical turning point for VERSES, reflecting immense financial pressures and a broader, unforgiving correction sweeping across the artificial intelligence industry. The company is betting its future on a leaner operation and a sharpened focus on its flagship product, Genius™, in a high-stakes gamble for survival and profitability.

“This Workforce restructuring will allow us to pursue our core target market with the greatest efficiency and speed and is a strategy that we believe positions us to drive the best return on investment and benefit to our shareholders,” said VERSES CEO and Founder, Gabriel René, in the official press release.

A Financial Tightrope Walk

The drastic nature of the restructuring is cast into sharp relief by the company's recent financial performance. Regulatory filings paint a picture of a company grappling with significant financial headwinds. For the six months ending September 30, 2025, VERSES reported a net loss of $19.5 million on revenues of just over $400,000. While this revenue figure represented a 159% year-over-year increase following the commercial launch of its Genius platform, it was dwarfed by the company's operational costs.

The most alarming metric is the company's cash burn rate. Cash reserves plummeted from $4.82 million at the end of March 2025 to just $1.21 million by the end of September 2025, a perilous decline that underscores the urgent need for the cost-cutting measures announced today. With total liabilities of $12.96 million far exceeding total assets of $3.64 million as of its latest reporting period, the company has been operating under the shadow of a “going concern risk,” a formal auditor warning that a company may not be able to meet its financial obligations.

In the months leading up to this announcement, VERSES has been actively seeking capital to stay afloat. In late 2025, it secured a CAD$2.65 million convertible debenture offering and a financing arrangement with a notional value of CAD$14 million. These efforts followed a share consolidation in March 2025, a move explicitly intended to boost its per-share price in preparation for a planned uplisting to the Nasdaq Capital Market. This restructuring appears to be the internal, operational component of a multi-pronged strategy to stabilize the company's finances and present a more viable investment case to the market.

Sharpening the Focus on 'Genius'

At the heart of the company's new, leaner strategy is its flagship product, Genius™, an enterprise software platform designed to create intelligent, autonomous agents. Unlike general-purpose Large Language Models (LLMs), Genius is marketed as a tool for creating reliable, domain-specific AI that can make predictions and decisions in complex and uncertain environments.

The company’s “core target market” appears to be a range of high-value industrial and enterprise sectors. VERSES has reported validation of its technology in diverse applications, from credit risk modeling in financial services and fleet optimization in logistics to predictive maintenance in manufacturing and medication efficacy in healthcare. The go-to-market strategy involves empowering systems integrators and consulting firms to build and deploy Genius-powered solutions for their large corporate clients.

This pivot represents a significant shift away from broad, exploratory research and development toward a highly focused commercialization effort. By concentrating its remaining resources on the most promising and potentially lucrative applications of Genius, VERSES is attempting to carve out a defensible niche in the crowded AI landscape. The success of this strategy hinges on whether these targeted use cases can generate substantial revenue quickly enough to offset the company's costs and reverse its financial trajectory.

A Symptom of an Industry Correction

The deep cuts at VERSES are not an isolated event but a stark example of a wider trend impacting the technology sector. After years of prioritizing growth at all costs, AI companies are now facing a market that demands a clear path to profitability. The global tech industry saw over 244,000 layoffs in 2025, with the trend continuing into early 2026. This “strategic recalibration” is driven by several factors.

The immense cost of developing sophisticated AI, from securing expensive GPU computing power to competing for a scarce pool of senior AI engineers, has created a challenging environment for startups. Coupled with elevated interest rates and a more cautious venture capital climate, the era of easy money for speculative tech ventures has ended. Investors are now scrutinizing burn rates and demanding sustainable business models.

Furthermore, the industry is maturing. The initial hype cycle around generative AI is giving way to a more pragmatic focus on real-world applications and return on investment. Companies like VERSES are being forced to prove that their advanced technology can solve tangible business problems and generate revenue, moving beyond ambitious whitepapers and into commercially viable products. This restructuring is a painful but necessary adaptation to that new reality.

The Human and Leadership Equation

Behind the strategic rationale lies a significant human cost. The decision to cut the workforce by half means hundreds of employees, including previously furloughed staff and executives, are now facing unemployment. The company's statement of gratitude for their contributions does little to soften the blow for those affected in a competitive tech job market that is simultaneously shedding and hiring talent.

The leadership team's decision to temporarily defer their own salaries is a gesture of solidarity and a practical move to conserve cash. However, it comes against a backdrop of executive compensation that has drawn scrutiny. CEO Gabriel René, who directly owns over 9% of the company, received a total compensation package of over $500,000 in the last fiscal year, a period during which the company remained deeply unprofitable.

For VERSES AI, the path forward is narrow and fraught with risk. The company has made a decisive, albeit brutal, choice to sacrifice scale for focus, betting everything on the commercial potential of its Genius platform. The coming months will be critical in determining whether this strategic pivot was a masterstroke of survival or a desperate, final gambit in a rapidly evolving AI market.