Although Twitter managed to beat analysts’ expectations, their revenues have continued to experience slow growth, causing the company to redirect their focus for 2017 in an effort to regain traction in the fast moving world of social media and deliver profits. Their plan to cut about 9% of its workforce is one of the company’s several initiatives to reduce internal costs, with cuts heavily focused on their marketing and sales teams. The news comes shortly after the retreat of several potential acquirers including Salesforce and Disney.
Twitter’s other cost cutting strategies include shutting down its Vine video app which reported dwindling revenue growth in Q3. Although Vine was once the premier tool for making short-form videos and jumped to the top of the rankings back in 2013, Twitter was never able to fully capitalize on vines capabilities. Their lack of a sustainable advertising model caused many top Viners to abandon the site. Over time, Vine struggled to grow its user base and find new ways to generate profit, which enabled competitors to dominate the market.