Twitter Inc TWTR is seeking to address fundamental weakness with some drastic measures. If a report that appeared in Bloomberg is to be believed, the company may soon announce plans to eliminate 8 percent (about 300 individuals) of its workforce.
SunTrust, in a research note released on Tuesday, explored job cuts as one of the options the company may mull to right-size cost structure in a bid to counter slowing sales growth.
Analyst Robert Peck of SunTrust estimates that an 8 percent reduction, if implemented, would align the company more with the other internet properties, providing leeway for savings of $50 million to $100 million per year.
Given its recent travails and the consequent drop in stock price, the Street is awash with speculation that a knight in shining armor may emerge to pull it out of the doldrums.
The kind of companies supposedly interested in Twitter have ranged from Google parent Alphabet Inc GOOG GOOGL to Microsoft Corporation MSFT to Verizon Communications Inc. VZ to Walt Disney Co DIS to salesforce.com, inc. CRM to Japanese telecom and internet giant SoftBank Group Corp SFTBF, with even a going private deal considered a possibility. The battered stock found occasional reprieves on these fleeting M&A rumors, although it is still down roughly 18 percent in the year-to-date period.
Now with the company looking to clean up, is it tidying up to make itself a more attractive target, or has it reconciled to the idea of surviving as a stand-alone company by setting its house its order?
In pre-market trading, Twitter shares were down 0.39 percent at $17.96. At last check, the stock was down 3 percent at $17.48.
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