Twitter purging 336 workers as new CEO slashes costs

The social-media giant said Tuesday morning it will reduce its workforce by about 336 employees, or 8%.

Twitter Inc.’s Jack Dorsey is making his first round of job cuts, a week after being appointed chief executive officer.

The purge comes two weeks after Twitter brought back one of its co-founders as permanent CEO in hopes that Dorsey would be able to resolve problems that have slowed user growth at the messaging service and compounded an uninterrupted cycle of financial losses.

The update sent shares in Twitter up more than three per cent in pre-market trading. The work on Moments began while Dorsey’s predecessor, Dick Costolo, was still Twitter’s CEO.

Last week, reports surfaced that Dorsey was planning company-wide layoffs at Twitter that could affect all departments.

In addition, Twitter said that it expects revenue and adjusted EBITDA for the third quarter of 2015 to be at or above the high end of the previously forecasted ranges of $545 million to $560 million and $110 million to $115 million, respectively. We feel strongly that Engineering will move much faster with a smaller and nimbler team, while remaining the biggest percentage of our workforce. We will honour them by doing our best to serve all the people that use Twitter.

It said it expects to spend the… However, it estimates total restructuring costs at between $5 million and $15 million – a lower figure due to “credit related to non-cash stock-based compensation expense reversals for unvested stock awards”. This is a good sign for the company, as it shows investors are confident in the outcome of the restructuring plan; Twitter’s Zacks Rank #3 (Hold) could see a change as well if the plan sees positive results.