MANILA, Philippines (UPDATED) – Twitter confirmed earlier rumors of a workforce reduction on Thursday, October 27, saying it was undergoing a “restructuring and reduction in force affecting approximately 9% of Twitter’s positions” globally as it reported a Q3 2016 revenue of $616 million, up 8% year on year.
In its Q3 2016 Shareholder Letter, Twitter said the restructuring – affecting about 350 jobs – would focus primarily on “reorganizing our sales, partnerships, and marketing efforts.”
Twitter estimated it would “incur approximately $10 million to $20 million of cash expenditures as a result of the workforce restructuring, substantially all of which are severance costs, and $5 million to $10 million of non-cash expenditures, consisting primarily of stock-based compensation expense. We expect to recognize most of the pre-tax workforce restructuring charges in Q4.”
Twitter said the restructuring “is intended to create greater focus and efficiency” and help move toward profitability in 2017.
Twitter’s revenues grew mostly due to advertising.
While Twitter did report a net loss of $103 million – compared to $132 million a year earlier –the company also reported a stable growth in its monthly active usage. Said Twitter, “Total MAUs grew to 317 million from 313 million in Q2.”
It added, “Organic growth and product improvements drove most of the increase, with marketing initiatives providing additional lift. Average daily active usage grew 7% year-over-year, an acceleration from 5% in Q2 and 3% in Q1.”
A posting of the full quarterly results is available on Twitter’s Investor Relations page.– with reports from the Agence France-Presse/Rappler.com