Twitter Planning Big Layoffs Under Dorsey [REPORT]

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Twitter named Jack Dorsey as the permanent CEO last week. A major reason for his selection was that he is the co-founder of the company, and therefore, can make the tough decisions that need to be made. Moreover, it looks like he isn’t wasting any time.

Is Twitter over-sized?

Citing multiple sources, a report from Re/code notes that Twitter is considering company-wide layoffs, but how much of the staff will be culled is not known yet. The insiders speculate that the lay-offs will impact most if not all departments.

Twitter wants to make its engineering organization leaner and more efficient, and the downsizing could be a part of it. The engineers make up half the staff at Twitter, and they are most likely to be impacted by the layoffs, the report says. Speaking to Re/Code, a spokesperson at the micro-blogging firm said “We’re not commenting on rumor and speculation.”

For years, people close to the company have argued that the firm has become over-sized. Just before the IPO, i.e. in the second-quarter of 2013, the company had nearly 2,000 employees, and in the last quarter it reported nearly 4,100 employees. However, a growth of less than 50% has been noted in the user base for the same period. Acquisitions have contributed to some of this growth over the past two years. Despite this, those close to the company feel that the engineering team at Twitter is much larger than needed.

Counting on the new CEO

For the last four months, Dorsey has been preaching that Twitter needs to be more focused, and this reorganization aligns with those comments. The company needs to do a better job of clarifying ownership around projects, Dorsey told Re/Code in June, and in August he restructured Twitter’s product team along similar lines. Now, it appears that the company will reshuffle the rest of its staff as well.

Twitter and investors are confident that co-founder and CEO Dorsey, who will be serving the company for the second time in this position, will bring spectacular growth to the company. Dorsey has been serving the company as the interim CEO since June, and just last week, he returned to the helm permanently while continuing to serve as the chief executive at Square. Square, a digital payments firm founded by Dorsey, is also growing at a very rapid pace.

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