Shares Pop As This $11B Tech Company Announces Double-Digit Headcount Cut: What You Need To Know

Twilio Inc TWLO will lay off 17% of its workforce (about 1,500 positions) as part of a major restructuring plan, the company announced in a Monday blog post.

What Happened: Twilio co-founder and CEO Jeff Lawson penned an open letter to Twilio employees saying that while the company saw record growth over the last 15 years, in light of the current macroeconomic environment, the business must prioritize profitability.

As part of the restructuring plan, Twilio will form two business units, Twilio Communications and Twilio Data & Applications. Lawson said each unit will be empowered to optimize its respective customer and business needs.

The restructuring will also include the winding down of some perks, and the closure of some offices over the next few months as the company shifts to remote work.

Read also: Layoffs 'Kill People' And Big Tech Firms Are 'Copycats' In Making Decision, Business Professor Says

Lawson expressed commitment to its departing employees, and has provided support to help them transition, including 12 weeks of base pay, continued health coverage, career resources, and other support. Twilio will continue to offer essential benefits, including medical, retirement, and the Employee Stock Purchase Program.

Lawson said he regrets having to part ways with so many talented employees but has emphasized that it is necessary to get the company in the right shape to succeed.

Why It Matters: This is the second round of layoffs within six months at Twilio — it laid off 11% of its workforce in September — adding to the general list of tech companies that have been departing with employees en masse.

According to Layoffs.fyi, 340 tech companies have laid off a total of 101,807 workers in 2023. Last year, 1,044 tech companies laid off 159,846 employees, according to the site.

Price action: Shares of Twilio traded 2.86% higher Monday to $61.78, according to data from Benzinga Pro.

Read next: Would You Work For Elon Musk At Twitter? 69% Of Benzinga Followers Say...