Twitter owner Elon Musk sent out a tweet Friday saying the company has experienced "a massive drop in revenue," due to advertisers pausing spending on the social network, coming as Twitter layoffs began on a large scale.
Advertisers that are pausing ad spending on Twitter include General Mills, Pfizer, Ford Motor, General Motors, Volkswagen and Oreo maker Mondelez International, reports said.
Meanwhile, Musk initiated plans to cut the Twitter workforce on Friday. It came little more than a week after he took ownership of the company. The cuts totaled about 3,700 jobs, or 50% of its workforce.
Also, reports said five workers had filed a class-action lawsuit in San Francisco federal court. The filing said the Twitter layoffs violated a California law. It did so by not giving advance notice of about 60 days when mass layoffs or plant closings occur.
Massive Drop In Revenue
Musk, Tesla's chief executive, is under pressure to boost income and cut costs after paying $44 billion for Twitter, taking on $13 billion in debt as part of the deal.
In a tweet Friday, Musk 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."
Twitter informed employees Thursday night in a companywide email to expect to receive messages on Friday morning, telling each of them whether they still had a job, the Washington Post reported.
"We recognize that this will impact a number of individuals who have made valuable contributions to Twitter, but this action is unfortunately necessary to ensure the company's success moving forward," according to the email obtained by the Washington Post.
Twitter stock was delisted from the New York Stock Exchange on Oct. 28.
Please follow Brian Deagon on Twitter at @IBD_BDeagon for more on tech stocks, analysis and financial markets.
