The retrenchment that accompanied the change in ownership of Twitter has pushed co-founder and former CEO Jack Dorsey to apologize to the affected staff.
Social media giant, Twitter Inc has laid off thousands of its contract employees as it continues on its aggressive cost-cutting mission. As by CNBC, the layoff was done without the full consent or information passed to the remaining staff who work directly with these contract staff.
Twitter Firing Contract Employees
Platformer the total number of fired contract workers at 4,400 out of 5,500, however, the company has not come out to confirm the news or the number. The laying off of staff is not new for the company which continues to find measures to reduce its cost of operations.
Anonymous Twitter employees say the company has also fired all of its internal communications team, a move that makes it difficult to pass important messages across.
The October 28 acquisition of Twitter by Elon Musk, the Chief Executive Officer of Tesla Inc (NASDAQ: TSLA), and opened up a new era for the company. After confirming that he liquidated billions of dollars to bankroll the acquisition, Musk noted that the company has been on a fund-losing streak averaging about $4 million per day.
The CEO’s aggressive stance on restructuring and new policies relating to free speech and subscription for verification has unsettled quite a number of its advertisers, some of whom have stopped placing ads on the platform.
Since taking over Twitter, Elon Musk has fired as much as 50% of the firm’s global workforce, a move he has justified in earlier communications with staff.
“Regarding Twitter’s reduction in force, unfortunately, there is no choice when the company is losing over $4M/day. Everyone exited was offered 3 months of severance, which is 50% more than legally required,” he said.
As it stands, Twitter is no longer a publicly traded company, and Musk will have to be creative in generating revenue beyond just the retrenchments.
Twitter Grew Too Fast Too Soon
The retrenchment that accompanied the change in ownership of Twitter has pushed co-founder and former CEO Jack Dorsey to apologize to the affected staff.
According to Dorsey, the company grew “too quickly” especially after it went public back in 2013. Prior to the New York Stock Exchange (NYSE) listing at the time, Twitter had just about 2,000 employees as revealed by filings lodged with the United States Securities and Exchange Commission (
As of the end of last year, the company’s staff strength had grown to over 7,500 modelings a growth that many can argue was not commensurate with the revenue being generated. Musk has informed the remaining Twitter employees that bankruptcy is not out of the question for the firm, however, it is unlikely that the world’s richest man is going to trail this path after so many investments in the firm.
As part of its efforts to diversify its products, Twitter has filed applications with Financial Crime Enforcement Network (FinCEN) to operate as a payment service provider, a request which if granted will place it as a competitor with Cash App and Paypal Holdings Inc (NASDAQ: PYPL).
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