Twitter, Inc. TWTR The company is reportedly cutting annual bonuses for employees amid the uncertain economy eating up its bread-and-butter advertising revenue.
What happened: The social media platform told employees in an email on Friday that their typical annual bonuses will be cut by up to 50%, the New York Times reported. The company blamed its poor financial performance for the predicament, the report added.
The bonus amount will fluctuate throughout the year depending on the company’s results, CFO Ned Segal allegedly said in an email. The Times noted that the company ties annual bonuses to its performance and to revenue and profitability goals.
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Why it matters: Twitter has already cut spending, slowed hiring and reduced its real estate footprint, the Times said in the report.
The social media platform reported a 1% year-over-year decline in second-quarter revenue in late July, marking the first revenue decline since 2020 and a loss for the quarter. Ad revenue, which accounts for around 92% of total revenue, fell 1%.
The company’s fundamentals are also suffering from the uncertainty Tesla, Inc. TSLA chairman Elon Musk’s Deal to take it private. After an agreement was reached between the two parties in late April, Musk pulled out of the deal, citing anomalies in the number of bot accounts.
Twitter has sued the billionaire to enforce the acquisition and the case will be heard in the Delaware Court of Chancery on October 17.
According to data from Benzinga Pro, Twitter closed Friday’s session up 0.30% at $43.99.
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