Twitter has just seen its workforce shrink. Again. At least so says The Information, which states that on Saturday the company undertook its eighth round of layoffs since Elon Musk took the reins at the end of last October. The slashing would have affected at least 50 people this time, including engineers in the area of advertising technology. This is not the first news of layoffs in the bluebird platform. Nor is it the only one that tells us about its finances.
What do we know about its workforce and the company?
Another (another) job cut. This has just been reported by The Information and picked up, among others, by Reuters. Citing people close to the case, the U.S. media reports that Twitter has laid off dozens of employees – at least 50, it says – in what would be at least the eighth round of cuts in the “Elon Musk era”. The measure would have affected several engineering teams, including those that support advertising technology, the main application of the platform and the technical infrastructure to keep the systems running.
Novel, but not new. This isn’t the first report of layoffs related to Twitter. Just a week ago The Information itself claimed that Musk’s company had also laid off sales and advertising employees. The biggest announcement of all came in November 2022, however, when it emerged that the company was targeting 3,700 employees. The layoffs were reportedly communicated that same week by e-mail.
Rumors of layoffs have been circulating on Twitter since before Musk even compared the company. Reuters went so far as to publish that October 2022 management would have already been looking at an $800 million cut in payroll expenses through the end of 2023, which would amount to the departure of a quarter of its workforce. The Washington Post reported around the same time that Musk’s intention was to cut even more: 75% of the workforce.
What is the objective? To adjust expenses in a company that, as Musk himself acknowledged in November, has suffered “a massive drop in revenue” related to the flow of advertising. After taking over Twitter for 44 billion dollars, the tycoon saw how relevant companies of the caliber of Mondelez, Audi and General Motors announced their intention to pause spending on advertising on the social network while waiting to see how the new phase would progress. It recently transpired that daily revenues had fallen by about 40% compared to a year ago and that 500 major companies have stopped investing in their ads.
What else has come out of the company? News that reveals an attempt to adjust its accounts. A few days ago The Economic Times reported that Twitter has closed two of its three offices in India, those in New Delhi and Mumbai, after laying off more than 90% of its more than 200 employees at the end of last year. On Friday CNBC also claimed that the firm is being sued by at least six companies in the US for breach of contract and non-payment.
Over the last few months Musk has clarified or corrected some of the information published about the company from his personal account. Shortly after CNBC stated in January that the company’s full-time workforce had decreased to 1,300 active employees, the tycoon clarified that the actual number of workers is around 2,300. This is a far cry from the estimated 7,500 that were operating at the time of his arrival at Twitter.
Finding the key to the business. The issue that undoubtedly focuses Musk’s attention is Twitter’s business model. His big bet since he entered its headquarters already with the rank of CEO, leaving a picture to remember in which he carries a sink between his arms, is undoubtedly that of the subscription model.
Since the end of 2022, the company has made several moves to promote its paid Blue service, reinforcing its appeal to companies and individuals with a color-coded verification system and greater features, including the possibility for users to opt for advertising revenue.