Twitter to lay off 8 percent of workers

By Barry Eitel

SAN FRANCISCO

Twitter announced Tuesday that it would lay off roughly 8 percent of its workforce – a week after Jack Dorsey became the microblogging platform's new permanent CEO.

The layoffs will mostly affect employees working in the company's engineering and product divisions, the company noted. As many as 336 employees will be dropped of an estimated total of 4,100 global workers.

The layoffs are part of a larger strategy of reviving user growth and expanding into new markets. Wall Street responded positively, with shares of the company jumping 6 percent during Tuesday morning trading. This increase is rare good stock news for Twitter which has seen its stock battered this year as its user base remained stagnant and it searched for a CEO.

"We feel strongly that engineering will move much faster with a smaller and nimbler team, while remaining the biggest percentage of our workforce," Dorsey wrote in a letter sent to employees Tuesday. "And the rest of the organization will be streamlined in parallel."

Earlier this year, former CEO Dick Costolo resigned and was replaced temporarily by Dorsey, a Twitter co-founder and an earlier chief executive. Last week, the company announced Dorsey would become its permanent leader even though he is also the CEO of online payments service Square.

Dorsey has already implemented two large changes to the platform during his brief tenure. He added a "buy now" button that allows users to purchase products directly from tweets as well as a new Moments feature, which is a human curated feed of news and other content. The company has also hinted that it is toying with dropping its iconic 140-character limit for tweets.

"Thank you all for your trust and understanding here," Dorsey continued in his memo to employees. "This isn't easy. But it is right. The world needs a strong Twitter, and this is another step to get there," he said.