Twitter suspends hiring after two CEOs leave

Twitter Inc. TWTR – 9.67% halts hiring and seeks cost cuts, as the social media company, amid a $44 billion acquisition by Elon Musk, faces market disruptions from digital advertising caused by the global economic crisis and conflict in Ukraine.

Twitter recruitment suspended after two CEOs left

According to an internal memo, Twitter CEO Parag Agrawal announced these steps along with the unexpected departure of two senior executives.

Mr Agrawal’s note, reviewed by the Wall Street Journal, said: “As of this week, we are suspending most hiring and replacements, except for critical roles.”

Twitter’s action is part of a broader turmoil in the tech industry in recent weeks, with a number of companies cutting staff and spending or slowing hiring.

Robinhood Markets Inc. HOOD 24.88%▲ last month said it would lay off 9% of its full-time employees and reduce the number of duplicate jobs it added when the investment platform was at full growth in 2020.

CVNA Carvana plans 2.43% to cut 12% of its workforce.

This month, Meta Platforms Inc. The parent of Facebook is hiring in a big way, ending a long period in which the tech giant was adding thousands of jobs a year. Facebook also said it will reduce its investment. Reuters previously reported that the popular Reality Labs in Meta will be affected. Meta declined to comment.

Mr Agrawal said in the memo that Twitter will evaluate all proposed offers and cancel any that it believes should be removed. Mr. Agrawal wrote that Twitter is not anticipating mass layoffs.

Agrawal wrote that the company also plans to cut spending on contractors and consultants, travel and events, marketing, real estate and infrastructure.

He wrote: “Please continue to treat Twitter resources as if they belong to you and stick to your budgets rigorously, prioritizing what matters most.”

Thursday’s trading activity ended on a 2.2% loss for Twitter shares.

Twitter has been through a long period of turmoil and has struggled to increase user numbers and revenue after a dispute with activist Elliott Management Corp. The company said more than a year ago that it would strive to at least double its revenue to $7.5 billion by the end of 2023, as well as reach at least 315 million monetized daily active users as of that date.

“At the start of the pandemic in 2020, the decision was made to invest aggressively to drive strong viewership and revenue growth, and as a company we own, we have reached the intermediate stages that allow us to be confident in the those goals. “Recently, the global macroeconomic environment has become less supportive, and the war in Ukraine has had an impact on our results, which may continue,” he added.

Tech companies are seeing the Covid-19 digital advertising boom starting to falter and facing mounting pressure as ad buyers grapple with rising inflation, supply chain shortages, conflict in Ukraine and other factors.

Meta said in its latest earnings report that its sales were affected by the ban on some of its services in Russia and the suspension of ads from Russian advertisers.

Snap Inc. said. A number of advertisers have paused ad campaigns after the Russian invasion of Ukraine in February, fearing that the digital ad spending environment could be further disrupted.

Musk, who agreed to buy Twitter late last month, said he wants to reduce Twitter’s reliance on advertising, which currently accounts for about 90% of its revenue.

Musk’s proposed acquisition and his comments on Twitter, where he has more than 90 million followers, have raised concerns among some employees. At one point, Mr. Musk mocked Vijaya Jade, Twitter’s longtime head of legal, policy and security, in response to the company’s allegations of political bias, prompting online attacks against him.

According to someone who heard Mr. Agrawal’s comments last month, layoffs are not expected and the company’s priorities will not change until the deal is closed.

Since Mr. Musk agreed to take over the company, their departure this week is the most notable change in the Twitter team.

Promoted to their positions in December, Bruce Falk, chief revenue officer, and Kevin Beckbor, chief consumer, left the company. The promotions came days after it was announced that Mr. Agrawal will succeed co-founder Jack Dorsey as the company’s new CEO.

According to a company spokesperson, Jay Sullivan will replace the two leaders. According to his LinkedIn profile, Sullivan has served as Vice President of Product since November. A spokesman said Mr. Sullivan will replace Mr. Bikbor and serve as Mr. Falk.

Mr Bikpur announced his resignation through a series of tweets, saying that Mr Agrawal had asked him to leave the company while he was on paternity leave. According to letters seen by the newspaper and people familiar with the situation, the timing of Mr Bikpur’s departure has shaken some colleagues.

Some employees asked for clarification on the severance package on Twitter, saying they needed to be able to predict their level of financial security in light of potential layoffs.

How are we expected to ‘keep doing business through the noise’ if we don’t get a response? A Twitter employee wrote, invoking the internal mantra of Twitter executives since Mr. Musk began his takeover pursuit of the company.

Twitter declined to comment on its employees’ reaction.

Leave a Comment