Michael Wood takes over Faafoi's immigration portfolio and former radio host Willie Jackson will take over broadcasting. Kiri Allan will now be Justice Minister and Associate Finance Minister.
"She has a big future in front of her, in my view," Ardern said of Allan.
Mallard, Speaker of the House, will step down in August and take on a diplomatic post in Europe. He has been an MP for 35 years and Speaker for five years. Adrian Rurawhe, Labour MP for Te Tai Hauāuru, will be nominated to replace Mallard as Speaker.
New MPs Dan Rosewarne and Soraya Peke-Mason will replace Faafoi and Mallard from the Labour list.
Rosewarne is a former Army officer from Waimakariri in Canterbury. Peke-Mason is from Rangitīkei, and has worked in tourism, forestry, and local Government.
Priyanca Radhakrishnan will now move into Cabinet, keeping the community and voluntary sector portfolio and adding the associate workplace relations and safety role to her job.
Labour's chief whip Kieran McAnulty will become a minister outside of Cabinet, with Christchurch Central MP Duncan Webb replacing him in the key managerial role.
Poto Williams to leave Police portfolio
Poto Williams is also being changed out of her Police portfolio.
She would take on conservation and disability issues, Ardern said.
The minister had faced heavy pressure from National after a spate of gang-related shootings.
Ardern said Williams and she both agreed the focus of where the police portfolio "needed to be" was lost.
Chris Hipkins will be the new Police Minister. He will co-lead a youth justice team to inquire about recent spikes in offending.
Given Hipkins' fondness of the education portfolio, Ardern said he would retain some of that role.
To free him up, a significant part of his education portfolio will go to Associate Minister Jan Tinetti.
Dr Ayesha Verrall will take on the Covid-19 response role, and will be the new Minister of Research, Science and Innovation.
Megan Woods will take over public housing, building and construction.
A more comprehensive review would take place at the beginning of next year, Ardern said.
On how big next year's reshuffle could be, Ardern said she would not put a number on it, but she wanted to flag there would be changes before election time.
PM - Cabinet reshuffle is 'minor'
On Mallard, Ardern said the role of Speaker was a difficult one.
It was not brought forward due to pressure he was under, she said.
Ardern said she did not believe it was misleading to say the reshuffle was "minor". There was one person leaving and one joining, she said.
Asked about implications for the TVNZ-RNZ merger, Ardern said Faafoi had done a huge amount of work in this area.
Although Faafoi intended to leave, she said his heart was still in the job.
Asked about Hipkins being overloaded with work, Ardern said much of the Education portfolio would now be with Tinetti.
Asked about Nanaia Mahuta, Ardern said it was very important she continued the Three Waters work.
But she would now have someone working with her in an associate role, freeing her up for more travel in Foreign Affairs.
On Faafoi trying to leave at the last election, Ardern said she felt he still had something to offer. Ardern said she was grateful he stayed on.
The conversation was before the last election, when he was considering moving from the Mana seat to the list.
Mallard role 'deeply satisfying'
"On Friday I advised the Governor-General of my intention to resign from the position of Speaker of the House of Representatives in August," Trevor Mallard said in a statement.
"I have had the honour of being unanimously elected three times by the House as a presiding officer. It has always been interesting and mainly deeply satisfying.
"I informed the Prime Minister in 2020 that I would prefer to move on during this term of Parliament. I asked Adrian Rurawhe to shadow me and to deputise for me extensively both in and outside the House. He has done a superb job.
"I won't be commenting further on my future role at this stage, but announcements will be made when appropriate."
Faafoi - 'an honour to serve New Zealanders'
Faafoi thanked the Prime Minister for the privilege of serving as a minister.
"I am the father of George, Fred and Theo who say they want to see more of their Dad, which is something I think is a reasonable ask," he said in a statement.
On June 22 his youngest son turned 5, and he had made the decision when that happened he would get out of politics.
When he left home this morning his youngest had said to "make sure you are at school visits next week".
Asked if he had lost passion for politics, Faafoi responded: "No, I love it."
"It is a bittersweet day. I could stay for a long time but I wouldn't get to know my kids as much as I should."
On Ardern, he said: "I thank her for being supportive and allowing me to call time on my political career. I remain in awe of her strength and leadership."
He was previously a Press Gallery reporter, staffer, MP and party whip.
Faafoi faced questions over how TVNZ handled the hiring of Breakfast host Kamahl Santamaria, who quit amid allegations of inappropriate conduct.
Faafoi also had the justice and immigration portfolios, and faced criticism in both areas.
He repeatedly refused to be interviewed about problems in the justice sector, and Act party leader David Seymour claimed immigration was a fiasco.
Opposition parties have voiced strong disapproval for Mallard, especially for his handling of the first few days of the anti-mandate convoy protest at Parliament.
And as the Covid-19 response declines in apparent political importance, National under new leader Christopher Luxon has increased its focus on law and order issues.
Along with Act, National has also attacked the Government for what it sees as a lack of clarity around co-governance.
Co-governance very broadly described arrangements for governments to share decision-making with iwi or other groups.
Luxon on Saturday said National opposed co-governance of public services and Act has called for a referendum on the issue.
National attacked the Government on the cost of living, with its rebukes intensifying since the consumer price index in the March quarter rose 6.9 per cent compared with a year earlier.
Such high levels of inflation have not been since 1990.
The Cabinet has 20 ministers and there are four ministers outside Cabinet.
In addition to those 24 people, Green Party co-leaders Marama Davidson and James Shaw are co-operation agreement ministers, with roles enshrined in a 2020 post-election deal.
Davidson is Minister for the Prevention of Family and Sexual Violence and Associate Minister of Housing, focusing on homelessness.
Shaw is Minister of Climate Change and Associate Minister for the Environment, focusing on biodiversity.
Under the agreement, the Greens support Labour on confidence and supply, and on procedural motions in the House and at select committees.
