Just when we thought our tweets couldn’t get any more compact. Micro-messaging service Twitter welcomed the autumn weather with an announcement that will see nearly a tenth of its talent migrate out the door - in hopes of sending its stock flying north.
Indeed, the company is laying off as many as 336 of its 4,100 employees, which will translate to an 8 percent cut in manpower. The move is aimed at cutting costs, redirecting funds toward other projects, and perhaps even actually make some money for the first time in nine years. That’s a tune we could tweet to - but not everyone might be singing such praises (we can think of at least 336 people who won’t be, for instance)
No cash in a hashtag
Since its inception, Twitter has lost a whopping $2 billion - spurring a slew of reactions from investors that couldn’t likely be summed up in a single tweet.
Those reactions could, however, likely be summed up in a single glance at the company’s stock performance since debuting in November of 2013. Opening at a price of around $41 per share before taking flight to a price of $69 per share by January 2014, investors may have seen potential. Profit, on the other hand, was yet to be observed. Fast forward to today and stock price has plummeted to around $29 per share at the time of this writing. Its new price puts it at a 38 percent decline over the past year alone.
But immediately following the announcement, share price gained some traction to jump 5 percent in a day. Fly, little stock, fly. Ah yes - the stock market loves a good comeback story (or a good layoff round - it’s, erm, hard to say for sure).
Goodbyes are such sweet sorrow
Meanwhile, Twitter CEO Jack Dorsey was likely finding it rather hard to say goodbye - without going way over 140 characters. In a 360-word memo titled (perhaps ironically), “A more focused Twitter,” the chief executive set out to explain the company’s decision for the layoffs before bidding his farewells.
“We are moving forward with a restructuring of our workforce so we can put our company on a stronger path to grow. Emails like this are usually riddled with corporate speak so I'm going to give it to you straight.”
He highlighted past accomplishments. He illustrated future obstacles. Then he continued:
“So we have made an extremely tough decision: we plan to part ways with up to 336 people from across the company. We are doing this with the utmost respect for each and every person. Twitter will go to great lengths to take care of each individual by providing generous exit packages and help finding a new job.”
He then offered his thanks, because - severance letters.
“Let's take this time to express our gratitude to all of those who are leaving us. We will honor them by doing our best to serve all the people that use Twitter. We do so with a more purpose-built team, which we'll continue to build strength into over time, as we are now enabled to reinvest in our most impactful priorities.”
He concluded by emphasizing the bottom line (no pun intended):
“Thank you all for your trust and understanding here. This isn't easy. But it is right. The world needs a strong Twitter, and this is another step to get there.”
Eloquent, Mr. Dorsey - verrry eloquent.
Surely it’s too early to tell just what profits such a move might hatch (if any), but one thing is clear: It may have taken nearly a decade, $2 billion in losses, and 336 job cuts, but Twitter may be ready to soar.
Even if that means doing so with a lighter nest.