Twitter Inc will lay off up to 336 employees, or about 8 percent of its workforce, as co-founder Jack Dorsey readies to revive growth in the microblogging service provider's user base in his second stint as chief executive.
The layoffs, primarily in the company's engineering and product functions, come a week after Dorsey took over as permanent CEO.
Shares of Twitter, which had about 4,100 employees globally as of June 30, rose as much as 6.7 percent to $30.68 on Tuesday.
"We feel strongly that engineering will move much faster with a smaller and nimbler team, while remaining the biggest percentage of our workforce," Dorsey said in a letter to employees. "And the rest of the organization will be streamlined in parallel."
FBN Securities analyst Shebly Seyrafi, however, said the company needed to focus also on "rationalizing sales" along with engineering to achieve its margin targets.
Dorsey, who was appointed Twitter's interim CEO in July after Dick Costolo resigned, has been candid about the company's problems.
Twitter's second-quarter growth in average monthly users was the slowest since the company went public on Nov. 7, 2013. Its stock nearly tripled to a record high of $74.73 in December 2013, but has fallen about 60 percent since.
"The general thinking is that Twitter has a product problem, which is why they picked Jack to come in. You would normally not be cutting in engineering if you have a product problem. So I scratched my head a little bit on that," Seyrafi told Reuters.
Since Dorsey took over as interim CEO, Twitter has rolled out a "buy now" button that allows users to make purchases and a feature that highlights the best tweets and content.
Cuts in the engineering department could hurt the company's "ability to continue growing at a robust pace," RBC Capital Markets analyst Mark Mahaney wrote in a note.
Twitter said it expected about $10 million-$20 million in severance costs and $5 million-$15 million in restructuring charges. Twitter expects to record most of these pretax restructuring charges in the fourth quarter.
Technology news website Re/code first reported the planned layoffs on Oct. 9.
Twitter said it expected its third-quarter revenue and adjusted EBITDA to meet or top the higher end of its forecasts.
The company, which will report its third-quarter results on Oct. 27, has forecast revenue of $545 million-$560 million and adjusted EBITDA of $110 million-$115 million.
Reuters
Wed Oct 14 2015
Twitter Inc will lay off up to 336 employees, or about 8 percent of its workforce.
Tiada kemunculan Amad, pertemuan Man United-Brentford
Kedua-dua pasukan Manchester United dan Brentford kehilangan seorang pemain kerana penggantungan untuk pertembungan Liga Perdana Inggeris Sabtu ini.
Singgah Sahur UMPSA santuni anak yatim, agensi keselamatan
Program Singgah Sahur UMPSA bukan sekadar bertujuan berkongsi rezeki, tetapi juga menjentik rasa keinsafan dan kesyukuran.
Sarawak Energy kini penaung Majlis Tenaga Dunia, pertama dari Asia Tenggara
Sarawak Energy secara rasmi menjadi penaung global Majlis Tenaga Dunia, sekali gus menjadikannya yang pertama dari rantau Asia Tenggara.
Dua lelaki tak mengaku rompak, menyamar polis
Dua lelaki dihadapkan ke Mahkamah Sesyen Seremban pada Jumaat atas pertuduhan melakukan rompak berkumpulan terhadap seorang lelaki, minggu lalu.
Pembinaan LRT Pulau Pinang tidak melibatkan tanah yang banyak
Menurut Menteri Pengangkutan Anthony Loke Kerajaan Negeri P.Pinang telah kenal pasti jajaran tersebut dan meminimakan pengambilan tanah dan tidak melibatkan bangunan-bangunan yang banyak.
Kemalangan: 45 maut kemalangan bas di Afrika Selatan
Seramai 45 maut dan seorang cedera parah selepas terlibat dalam kemalangan bas berhampiran Mamatlakala di wilayah utara Limpopo, Afrika Selatan, pada Khamis.
'Fast track' Mahkamah Syariah selesai kes cerai dalam masa sehari
Perkhidmatan laluan pantas atau 'fast track' Mahkamah Rendah Syariah Wilayah Persekutuan yang diperkenalkan pada 2021 berjaya menyelesaikan kes antaranya cerai dalam masa sehari.
Ops Samba 2.0: Ketirisan akibat penyeludupan di Kargo KLIA cecah RM2 bilion - KP SPRM
Jumlah ketirisan akibat kegiatan sindiket penyeludupan babitkan beberapa anggota Jabatan Kastam Diraja Malaysia di Kargo KLIA mencecah RM2 bilion bagi tempoh tiga tahun lepas.
Lebih 100 pelajar Nigeria berjaya dibebaskan tentera
Tentera Nigeria telah menyelamatkan pelajar dan kakitangan yang diculik oleh lelaki bersenjata dari sebuah sekolah di utara negara itu beberapa hari sebelum tarikh akhir pembayaran wang tebusan sebanyak $690,000 dolar.
Pembinaan Projek LRT Laluan Mutiara disasarkan bermula tahun ini
Kata Menteri Pengangkutan Anthony Loke, pelaksanaan keseluruhan projek dijangka memerlukan tempoh masa lebih kurang enam tahun dan disasarkan beroperasi pada tahun 2030.