Twitter to slash 9% of global workforce as it struggles to attract new users

Monthly active users hit 317 million for the third quarter, compared with about 313 million in the previous quarter

 

Twitter will lay off 9% of its employees as it embarks on a restructure of the business.

Twitter said the job cuts will focus primarily on reorganising its sales, partnerships and marketing efforts. Now twitter struggles to attract new users. "says the chairman of twitter'

The move comes despite the social company's third-quarter 2016 revenue and earnings exceeding Wall Street expectations.

The company posted quarterly revenue of $616 million, up 8% year-over-year, and adjusted net income of $92 million, or 13 cents per share.

Wall Street expected Twitter to post revenue of $606 million and adjusted EPS of 9 cents.

However, user growth remained stuck in low gear, as expected.

Monthly active users hit 317 million for the third quarter, compared with about 313 million in the previous quarter. Analysts had expected a net gain of 3 million.

"Our strategy is directly driving growth in audience and engagement, with an acceleration in year-over-year growth for daily active usage, Tweet impressions, and time spent for the second consecutive quarter," Twitter CEO Jack Dorsey said in announcing the results.

"We see a significant opportunity to increase growth as we continue to improve the core service. We have a clear plan, and we're making the necessary changes to ensure Twitter is positioned for long-term growth.

"The key drivers of future revenue growth are trending positive, and we remain confident in Twitter's future."

The news comes after a topsy-turvy month for Twitter. Disney, Google and Salesforce.com were all mulling deals to buy the company, before each of them backed away from bids.

Disney specifically was reported to be discomfited with the chronic problem of user abuse and hate speech on Twitter - an issue that Dorsey has said is a top priority for the company to address.

"Further restructuring may buy Twitter time but won't solve the underlying problem about what it is and where it wants to go," said Tina Judic, CEO of digital performance agency Found, commenting on the news.

"Increasingly, it's feeling like a news, or perhaps even sentiment platform, is where Twitter will realise its full potential.

"Twitter is the ultimate barometer of anything and everything, and its latent value could be in the intelligence it imparts globally each second of the day.

"With the correct strategy, Twitter has the potential to further eat away at the bigger, established news outlets. After the recent suitor disappointments, a major media outlet may well be a natural acquirer."