Twitter fires two executives and freezes most hiring after Musk's deal to buy company

Mike Isaac / New York Times News Service

SAN FRANCISCO - Twitter's CEO fired two top executives, froze most new hiring and said he was slashing spending Thursday, as the social media company tries to change its business trajectory while grappling with a takeover from Elon Musk, the world's richest man.

In a memo shared with employees and obtained by The New York Times, CEO Parag Agrawal said the company was pausing most hiring and pulling back on discretionary spending, although it was not planning layoffs. The moves stemmed partly from Twitter not hitting goals in audience and revenue growth, Agrawal wrote.

Kayvon Beykpour, Twitter's general manager, and Bruce Falck, the general manager for revenue, are leaving, the memo said. Beykpour is being replaced by Jay Sullivan, the interim general manager of consumer product, the memo said.

"It's critical to have the right leaders at the right time," Agrawal said in the memo. He added that Twitter had decided at the beginning of the pandemic in 2020 to invest aggressively in growth, but "as a company we did not hit intermediate milestones that enable confidence in these goals."

Beykpour and Falck said on Twitter that they had been fired by Agrawal. Falck later appeared to delete his tweet.

Brian Poliakoff, a Twitter spokesperson, confirmed the memo and Agrawal's changes. He declined to comment further.

The changes raise questions for Musk about his $44 billion deal to buy Twitter. The billionaire, who has said he does not care about the economics of the company, is paying $54.20 a share for the firm. In a pitch to investors, he has also said he wants to quintuple Twitter's revenue by 2028 and grow its users to 931 million by then, up from 217 million at the end of last year.

But Twitter's shares have been sinking, part of a broader pullback in technology stocks, and hovered at $45.22 on Thursday. Agrawal's moves also signal that the company's business, which relies mainly on digital advertising, is troubled. Last month, Twitter reported quarterly revenue growth and profits that fell short of what Wall Street had been anticipating.

"Looking into a crystal ball two weeks ago, the board made a great decision," said Brian Quinn, an associate professor at Boston College Law School focusing on corporate mergers, referring to Twitter's board. "The idea the board could reasonably get to a $54 price on their own by their own making was debatable before they took the offer - but clearly now, it's not going to happen anytime near term."