Layoffs: Elon Musk says Twitter is losing $4 million per day due to large workforce

Twitter owner, Elon Musk, has justified the ongoing mass layoffs at the company, saying that Twitter has been losing $4 million per day because of its large workforce. According to him, this left the company with no choice but to let some people go. He, however, did not explain how the company’s large workforce is causing the loss.

Good severance packages: Musk noted that everyone affected by the layoffs was given three months of severance packages, which is 50% higher than legally required.

He said:“Regarding Twitter’s reduction in force, unfortunately, there is no choice when the company is losing over $4M/day. Everyone exited was offered 3 months of severance, which is 50% more than legally required.”

The massive layoffs: Nearly half of Twitter’s workforce, 3,700, are being laid off in an exercise that saw many receive their job termination notifications via email on Friday. The move came barely one week after Elon Musk took over ownership of the company.

Other Musk moves: Aside from drastically reducing Twitter’s workforce, Musk has also announced that users would soon begin to pay $8 a month to get/retain their verification badges. Although the announcement has generated negative reactions from some users, Musk has insisted there is no going back on the plan. He tweeted this morning: “Trash me all day, but it’ll cost $8.”

News continues after this adDeclining ad revenue: Amidst Musk’s complaint of a reduction in Twitter ad revenue, more advertisers have vowed to suspend paid advertisements on the platform.

The latest company to do this is Volkswagen, which on Friday said it has recommended to its brands to pause paid advertising on Twitter until further notice in the wake of Elon Musk’s takeover of the social media platform.

“We are closely monitoring the situation and will decide about the next steps depending on its evolvement,” Europe’s top carmaker said in a statement.

The decision by Volkswagen Group, which covers the VW, Seat, Cupra, Audi, Lamborghini, Bentley, Ducati and Porsche brands, echoes similar sentiments by other firms, including GM and General Mills Inc.

Musk had on Friday lamented about a drop in Twitter’s ad revenue. He said: “Twitter has had a massive drop in revenue, due to activist groups pressuring advertisers, even though nothing has changed with content moderation and we did everything we could to appease the activists. Extremely messed up! They’re trying to destroy free speech in America.”