Twitter has been having an incredibly hard time in the market as of late; and for very good reasons. Now, as an attempt to solve the issues they've been facing, the company has made the decision to start laying off employees. Today, we'll talk about the issues Twitter has been facing, their layoff plans, what we can expect from the stock moving forward and how binary options traders should react to the news. So, let's get right to it…

The Problems Twitter Has Been Facing

As mentioned above, Twitter has been having a rough time in the market as of late. These hard times have been the result of two major issues…

  • User Growth – First and foremost, Twitter has been struggling to get new users into their social network and retain them as regulars. While the company is great at monetizing their user base, investors have been concerned that the new user plateau will lead to a revenue plateau. Since investors are looking for growth, this is incredibly bad news for Twitter.

  • CEO Worries – As a result of the user growth issues, the CEO of the company, Dick Costolo was forced to resign. Jack Dorsey stepped in as an interim CEO of the company and for months, the company had a hard time finding a new executive to take his place. As a result, Dorsey has made the decision to become the permanent CEO of the social networking company. While Dorsey was the prime pick for investors, the fact that he's also CEO of Square raises some major concerns with regard to time restraints.

These two issues have led to declines. However, the stock is starting to turn around based on Dorsey's appointment as permanent CEO and his first big move in his position.

Jack Dorsey Lays Off 336 Twitter Employees

Jack Dorsey knows that Twitter has a big problem with regard to user growth. So, he plans on restructuring the company and effecting major change that will turn this around. His first move as permanent CEO of Twitter was recently announced. Under Dorsey's management, Twitter will be laying off 336 employees. While cost cutting is important, this has far more than cost cutting behind it. In his message to employees, Dorsey had the following to say

We are moving forward with restructuring of our workforce so we can put our company on a stronger path to grow… The roadmap is also a plan to change how we work, and what we need to do that work. Product and Engineering are going to make the most significant structural changes to reflect our plan ahead. We feel strongly that Engineering will move much faster with a smaller and nimbler team, while remaining the biggest percentage of our workforce… So we have made an extremely tough decision: we plan to part ways with up to 336 people from across the company. We are doing this with the utmost respect for each and every person. Twitter will go to great lengths to take care of each individual by providing generous exit packages and help finding a new job.”

What This Means For Twitter And How Binary Options Traders Should React

There are a couple of good pieces of news here for Twitter stock. First, investors are happy to see Dorsey in the permanent CEO position. This is likely to lead to increases in the value of the stock. Also, not only is the company cutting costs here, they are restructuring in an attempt to solve their user issue. This is another factor that investors will look at positively. With that said, Twitter is likely to see more growth… at least for the short term. With that said, now is the time to look for call option opportunities on the stock by following support trend lines and purchasing calls at these points. Be sure to check our latest financial news.

What Do You Think?

Where do you think Twitter is headed and why? Let us know in the comments below!

[Image Courtesy of International Business Times]