Twitter reportedly planning to cut hundreds of jobs this week
As it approaches its third quarter earnings release, Twitter is reportedly planning to announce extensive job cuts this week.
The ailing social platform may cut approximately 8 percent of its staff — around 300 people — recalling a similar move it made last year when current CEO Jack Dorsey took over the reins, reports Bloomberg.
Earlier on Monday, Twitter announced its third quarter earnings release was being rescheduled to the pre-market time slot of 4 am PT (7am ET). The norm for tech companies is to report earnings after the market closes at around 1 pm PT, to accommodate the East Coast. For a company that’s currently under the microscope — courtesy of ongoing speculation regarding its acquisition — the move has led to much debate. However, it could simply be a case of Twitter rescheduling to avoid clashing with other earnings announcements on the day, including reports from Amazon and Google.
— TwitterIR (@TwitterIR) October 24, 2016
As recently as this month, analysts were predicting that job losses could be on the cards for Twitter, with estimates between hundreds to thousands of staff cuts. Noting the company’s operating losses (which amounted to more than $500 millon last year), Bronte Capital hedge fund manager John Hempton previously said the company’s CEO should be fired, and cutbacks made to save on expenses. The overwhelming majority of that loss was due to its staff equity grants, which came in at around $682 million in 2015.
The added scrutiny reflects the importance of the upcoming report. It’s been a tough year for Twitter, and its CEO Jack Dorsey. Following two previousquarters of sluggish user growth, the company’s board made the decision to evaluate formal takeover bids, scheduled for the same day as its Q3 report. At first, a number of suitors were rumored to be mulling an offer (with Google, Salesforce, and Disney thought to be the most likely candidates to make a bid). In an embarrassing turn of events, the previous few weeks has seen all three firms officially back away from the process, leaving Twitter out in the cold. Meanwhile, the company’s stock continued to plummet, losing 40 percent of its value over the past 12 months.
Twitter’s Q3 earnings report will finally reveal whether its gambits on live video and changes to its core product are paying off. At this stage, nothing short of a miraculous turnaround will impress investors.
Originally posted 2016-10-25 09:41:02.
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