Twitter Lays Off Loads Of Workers, Signaling Trouble
Twitter has laid off a ton of workers and it looks like it could be a sign of troubling times ahead for the social media company.
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Twitter joins a number of companies currently issuing massive layoffs for their salaried workers. After the company announced a hiring freeze, a wave of firings swept the social media platform. The move comes at a turbulent time for the company, where Elon Musk and Twitter shareholders are waiting to agree on the potential acquisition of the media site.
Last week, it was officially reported that Twitter would remove 30% of its talent acquisition staff, fewer than 100 people on the team. A spokesperson for the social media company confirmed that these layoffs were occurring, stating that the business and budget needs have changed, which led to the recent firings. Twitter’s stock prices have also decreased in recent months, leading to contention between company executives and Elon Musk.
It was expected by the public and the social media employees that Twitter would have some staff overhaul this summer. In May, the company announced that it would freeze new hiring at the company as stock prices plummeted. Only roles deemed “business critical” would be filled for the foreseeable future, attempting to cut down on the company’s labor costs. Consequentially, several top executives resigned from their positions, possibly worried about the company’s devaluation and soon-to-be owner Elon Musk. The combination of financial and social factors occurring at Twitter has put the media platform in a precarious position, with many not knowing how it will sustain itself with less staff and no finalized offer from Musk.
Like other tech companies, the stock market has not benefited Twitter’s value. On Friday Morning, stock prices for Twitter went down by 4% and are down by 12% since 2021. Since Elon Musk’s initial proposal to purchase Twitter, stock prices have gone down by 30% below Musk’s introductory offer. Now Musk is attempting to get Twitter to lower the agreement’s cost, though its executives have stated that they’ll stand firm on its original value.
There’s always the possibility that Elon Musk will deviate from his deal signed with Twitter back in April. Though Musk is presumably afraid of the social media platform’s devaluation, the Tesla CEO stated his fears about Twitter’s unregulated bots and spam accounts. But because Musk had already signed an agreement with Twitter about purchasing the company, pulling out of the deal for whatever reason could lead to an extensive legal battle and monstrous fees. The consequence of breaking the contract could lead to a substantial $1 billion payment, a fee Musk desperately wants to circumvent.
Though Elon Musk has the potential to pay an outstanding debt to Twitter for backing out of the deal, it’s looking more plausible that the Tesla CEO will abandon the purchase offer. On Thursday, the Washington Post reported that the agreement was in definite peril due to Twitter not giving sufficient data about the number of bots on the platform. Though Musk has reiterated that Twitter has not complied, a spokesperson for the social media company stated that they had given sufficient data about bots and spam accounts. It’s unclear if Twitter hasn’t released enough data to quell Musk’s fears or if the entrepreneur is just desperately trying to maneuver his way out of the contract.
