According to reports, Twitter is planning to cut off 9 percent of its employees. This means that around 350 people will be left jobless because of the company’s wish to reduce costs and focus on its activity. Until now, this was only a rumor, but this morning it was confirmed that it is indeed true.
And it is not that Twitter has not earned enough money, about $616 million. But with all this, revenue growth is slowing down and the company is losing money. Their user growth is also not extraordinary, with only 317 million active users in the third quarter. They recorded a loss of $102.9 million. So their new goal is to become profitable next year. In order to achieve this, job cuts are necessary. The sales and marketing departments will be the main targets.
Will this make Twitter more attractive to buyers?
It is possible. By reducing costs and becoming more profitable, they will become a valuable target for other companies interested to achieve Twitter. Salesforce and Disney have been some of the companies which were rumored to want to buy Twitter. But these remained rumors, because no deal was signed. What could be the main reason for their unattractiveness? Maybe the high price tag. Twitter reportedly costs around $20 billion.
Also, buyers might be afraid of Twitter’s bad reputation with trolls and abuse. Let’s not forget that the terrorist organization ISIS has a Twitter account through which they are claiming their attacks. And those attacks are killing more and more people. Why would someone want to buy such a company? A company that makes it easier for terrorists to communicate their intentions. How could a company like Disney close such a deal? It really does not make any sense.
They are trying to get better
Recently, the company addressed all of these problems in a letter. Over the last few months they are saying that they have worked to ensure safety for all of their users. And to also promote and update their safety policies. According to them, next month will bring important updates to their systems in regard with this matter. But we have heard this before, haven’t we? If they wat to get better, or if they want to get bought and not have to cut people’s jobs, they will have to keep their promises.
But many analysts do not expect any wave of interest in the coming months. Some have blamed Chief Executive and co-founder Jack Dorsey for this situation. So he will be under serious pressure from now on. His job will be to reassure eventual buyers that the company is doing great and that they are safe and ready to be bought.
And while Twitter is struggling, rival Facebook is doing better and better. Even smaller companies like Instagram, Pinterest and Snapchat are starting to get more user popularity and income. So this could mean trouble up ahead for Twitter if they do not change something. This job cut might do the trick but will it be effective in the long run? For them, let’s hope it will.
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