Twitter is considering slashing its workforce 8% further or about 300 employees, reported Bloomberg on Monday, citing people familiar with the matter. The company will report its third quarter earnings on Thursday and might announce the job cuts before that. The number of job cuts might change, adds Bloomberg.
Twitter to continue cutting jobs
A week after Twitter’s current CEO, Jack Dorsey, took over as permanent CEO last year, the company announced its plan of laying off up to 336 employees or 8% of its workforce. As of June, there were 3,860 employees working for the company globally. In September, the company said it would lay off some employees and stop the engineering work at one of its development centers in India’s technology hub Bengaluru.
Twitter has incurred huge losses and also saw a decline of 40% in its share price over the past 12 months. This made it even more difficult for the company to pay its engineers with stock. This also made it hard for the company to compete for talent with arch rivals such as Google and Facebook.
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Earlier this month, Greylock Capital Associates, an emerging markets hedge fund, filed for bankruptcy protection in New York assets under management dwindled from nearly $1 billion in 2017 to $450 million at the end of 2020. After three years of losses, Bloomberg reported that assets could drop below $100 million by the end of the Read More
Hopefully laying off employees will relieve it of some of this pressure. As of now, there has been no comment from the company about the Bloomberg report.
Growth issues at Twitter
Last month, the company hired bankers to field acquisition offers. But now it is facing an uncertain future as the last company that was believed to be interested in buying it, Salesforce, has now said that it won’t make a bid. Twitter, with a market cap of about $12.76 billion, is incurring annual losses of $400 million. This made its prospective buyers think it was too expensive.
While most of Twitter’s peers have added a significant number of users and have adequately monetized through advertising, Twitter has failed to do any of this. In the second quarter, the company had 313 million MAUs, while the number went up by 3% on a year-over-year basis to 310 million in the next quarter.
Twitter informed investors on Monday that it had rescheduled the release of its third quarter earnings to before the market open on Thursday to avoid conflict with earnings announcements by other internet companies. Its original plan was to release results after the market close, notes Reuters.
On Monday, Twitter shares closed down 0.33% at $18.03. Year to date, the stock is down almost 19%, while in the last year, it is down more than 40%. The stock has a 52-week high of $31.87 and a 52-week low of $13.73.