Twitter has announced it will soon shed an estimated 336 positions, or about 8% of its workforce.
Twitter, the social media platform that promotes streamlined communication, is looking to improve its financial standing. To that end, the company has announced it will soon shed an estimated 336 positions, adding up to a downsizing of about 8% of its workforce.
The move to circle the wagons comes on the heels of the announcement that Twitter’s co-founder Jack Dorsey will serve as the company’s permanent CEO. Dorsey stepped into that position on an interim basis after long-time CEO Dick Costolo left the company in June 2015. Dorsey assumed the interim role at a time when the company’s user growth and engagement were sagging and earnings were lackluster.
During Twitter’s June second-quarter conference call, Dorsey called out the company’s performance in the face of competition as “unacceptable.” He promised changes, and has been making them happen courtesy of new partnerships to monetize the platform while making it more attractive to users.
With initiatives such as The Relay project that enables Twitter to serve as a sales platform complete with “buy now” buttons, the numbers are starting to turn around. Third-quarter projections are anticipated to be at or higher than the forecasted range of $545 million to $560 million, the company noted in its SEC filing announcing the layoffs.
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As for those layoffs, Dorsey also announced them in a letter to staff. In that letter, he indicated the company was retooling itself with a “streamlined roadmap for Twitter, Vine and Periscope.” The roadmap is meant to strengthen the company while enabling it to move forward on a “stronger path.”
The layoffs, Dorsey indicated, will come largely from the company’s product and engineering divisions with the intention to enable engineering to “move much faster with a smaller and nimbler team.” Even with the reorganization, engineering will remain the biggest segment of Twitter’s workforce.
Employees targeted in the layoffs will receive what Twitter is calling “generous exit packages,” along with job-search assistance. The layoffs are anticipated to have a price tag of between $10 million to $20 million to cover severance packages. Restructuring costs could also add up to as much as $15 million.
Designed to maintain profitability while not impacting Twitter’s revenue-generating abilities, the restructuring seems to be embraced by stockholders. The company’s stock spiked 3% in premarket trading shortly after word of the layoffs hit the streets.
