Software giant Atlassian has announced it is laying off about 10% of its workforce, or roughly 1,600 positions, and replacing its chief technology officer as it restructures to invest further in artificial intelligence.

Shares of the company rose more than 4% in extended trading on the Nasdaq.

The company’s co-founder, Mike Cannon-Brookes, told employees the move was “the right decision for Atlassian” in a note circulated late Wednesday, US time.

“But that doesn’t mean it’s easy,” he said. “Far from it. I know this has a huge impact on each of you, and it weighs heavily on me and Atlassian today.”

About 640 affected employees are in North America, 480 in Australia and 250 in India, with the remainder spread across Japan, the Philippines, Europe, the Middle East and Africa, a spokesperson said.