Elon Musk reportedly orders broad layoffs at Twitter

APPS

New Twitter Inc. owner Elon Musk is reported to have ordered broad layoffs at the online news and social networking site, The Wall Street Journal reported today.

Coming into the acquisition of the company Thursday by Musk (pictured), reports suggested the job cuts could be as high as 75% of the company’s workforce. However, the Journal report noted that the full scale of cuts being discussed couldn’t be determined. Referencing people familiar with the matter, the report said layoffs are expected to reduce engineering positions and other positions in the company.

Musk’s reorganization of Twitter started on the day he took control of the company and began with the purge of prominent executives. According to reports, those “escorted out” of Twitter headquarters were Chief Executive Officer Parag Agrawal, Chief Financial Officer Ned Segal, Vijaya Gadde, the head of legal policy, trust and safety, and Sean Edgett, the company’s general counsel.

Subsequent reports suggested that the four senior employees were allegedly fired “for cause,” with Musk claimed to have done so as a way to avoid paying those senior executives multimillion-dollar severance packages. The Journal said the former executives are now weighing their options, with two executives having been set to collect more than $100 million in their severance packages.

The alleged attempt to avoid paying out benefits — all the details remain speculation at this point — could also mean further staff will be fired on Monday. Tuesday, Nov. 1, is a vesting date for Twitter’s compensation program.

Although the swiftness of Musk’s purge of senior executives on his first day on the job was surprising to some — Gadde is reported to have cried upon hearing the news — a push by Twitter to reign in employee costs is not new. Twitter fired several top executives and announced a hiring freeze in May, with Agrawal saying at the time that he was “proud that we shifted the culture internally to make bigger bets, move faster and eliminate sacred cows.” Little did he know that he would be the head “sacred cow” eliminated this month.

The job cuts at Twitter come amid a worsening macroeconomic outlook as experts predict that the world could be heading toward a global recession amid 40-year-high inflation and the ongoing Russian invasion of Ukraine.

Given the current outlook, tech firms large and small have announced layoffs or have frozen hiring. Companies that have cut staff include Microsoft Corp., DocuSign Inc., Twilio Inc., Robinhood Markets Inc. and Oracle Corp. Companies that have frozen hiring include Google LLC, Apple Inc. and Meta Platforms Inc.

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