Do Cutbacks Bode Well For Twitter?

Grow or die: The words are gospel in Silicon Valley, as well as Wall Street, where much of its stock is traded.

Yet, until he can get his house in order, Jack Dorsey appears ready to pull back the reins on Twitter’s expansion plans.

Any day now, the social giant is expected to announce companywide layoffs. That is, rather than targeting a particular arm or initiative, Twitter’s second-time CEO is looking to prune ranks to reduce the company’s overall size.

That said, engineers will likely bear the brunt of the cuts, since the company is reportedly in the process of restructuring its engineering teams.

How big is Twitter, anyway? Well, when the company went public in mid-2013, it had about 2,000 employees. By last quarter, it had more than doubled that number to around 4,100 positions.

The cuts seemingly jibe with management’s mandate to focus Twitter’s business operations and product offerings.

Also, shedding staff is standard practice for a publicly traded company looking to shore up its financials, not to mention a new (or returning) CEO trying to make a statement.

The risk, however, is that Twitter could lose -- or not be in a position to take on -- the talent it needs to shine. 

The reported downsizing would come on the heels of Twitter’s decision to abandon plans to take over about 100,000 square feet of hot Bay Area office space.

So, where is Dorsey going to put all the bright young minds who are supposed to help Twitter hold its own against Snapchat, Facebook, and other companies competing for consumers' time? These firms are not slowing down, and they’re more anxious than ever to eat Twitter’s lunch.

To say that this is a tenuous time for Twitter would be an immense understatement.

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