Twitter tells worried employees their vested shares will be paid in coming days
The Twitter profile page belonging to Elon Musk is seen on an Apple iPhone mobile phone.
Nurphoto | Nurphoto | Getty Images
After Elon Musk closed his $44 billion purchase of Twitter last week, employees at the company braced for job cuts. Some told CNBC they were worried about losing their equity compensation if Musk sent them packing before their shares vested the first week of November.
Musk and Tesla have been sued repeatedly over employees’ claims that they were fired just before their shares vested, depriving them of compensation.
However, it appears that the current tranche of stock-based compensation for many Twitter employees, who were there before Musk took over, will get paid out after all.
According to employees at the company and internal communications viewed by CNBC, newly vesting shares are expected to be paid in the first half of November, starting as early as Nov. 4. Employees said they were reassured by managers that the company’s payroll department was working on processing their vested stock.
Tech companies are known for paying a high percentage of their compensation through stock awards, and Twitter has been notably reliant on equity payouts. In the first six months of 2022, Twitter recorded a stock-based compensation expense of $459.5 million, up from $289.1 million during the same period a year earlier. That’s close to 20% of Twitter’s revenue for the quarter.
Musk has indicated many times in recent months that Twitter is overstaffed and that one of his first moves would be to make dramatic reductions. He’s already gotten rid of top executives, starting with the CEO, CFO, policy chief and other high-ranking leaders and their direct reports. Musk reportedly fired them “for cause,” potentially to avoid paying millions of dollars in so-called golden parachutes.
It’s not clear whether other executives and employees who were fired or who resigned after Musk bought the company will be compensated for shares about to vest. Twitter didn’t immediately respond to a request for comment.
Musk was scheduled to hold an all-hands meeting with Twitter employees on Nov. 2. The meeting was canceled unexpectedly, employees told CNBC.
The New York Times reported that layoffs at Twitter could take place before Nov. 1, a date when many employees were scheduled to receive stock grants.
Musk responded, “this is false,” in a tweet on Friday, though he didn’t provide any evidence or further details.
Twitter employees had some reason to be concerned about their equity, given the company is now in private hands, and because Musk has a history of apparently trying to avoid payouts.
According to 2009 deposition transcripts from a high-profile Tesla lawsuit, Martin Eberhard v. Elon Musk et al, a former Tesla Chief Information Officer named Gene Glaudell said Musk and other Tesla executives at that time, “did not want to say in public that Tesla was making cuts for financial reasons.” Rather, they tried to attribute the cuts to “performance and management accountability.”
In a lawsuit after that, about 50 former Tesla employees claimed the company had terminated them without paying equity compensation that they’d been promised in job offer letters. The former Tesla employees won, but the electric vehicle maker was able to overturn the decision later on appeal.
Musk is the richest person on the planet, with most of his wealth derived from Tesla stock via the perforam and a historically large compensation package that the company has granted him through the years.
Some unhappy Tesla shareholders are slated to take Musk and the Tesla board to court this month over his 2018 CEO compensation package. They allege that it was reckless to give away so much of the company’s stock to Musk, and that the pay package failed to achieve its stated purpose of getting him to focus on Tesla’s business.
Kathaleen McCormick, the same judge who encouraged Musk and Twitter to settle their differences and complete the $44 billion transaction they agreed to in April, is deciding the case.
The photo illustration shows the Bitcoin cryptocurrency on November 12, 2024 in Shanghai, China.
Vcg | Visual China Group | Getty Images
The price of bitcoin leapt back above $100,000 to start the first full trading week of the new year.
The flagship cryptocurrency was last higher by about 4% at $102,234, according to Coin Metrics. The broader crypto market, as measured by the CoinDesk 20 index, gained more than 3%. Bitcoin and ether are coming off their best weeks since Dec. 6, while Solana had its best week since Nov. 22.
“Overall, we are in a bullish environment and traders appear to be risk-on as we head into the new year,” Mario Jurina, CEO at crypto swaps platform Jumper.Exchange. “With Trump’s election set to be certified today, and January often being a bullish month — six of the past 10 years saw positive price action — it’s no wonder markets are moving upward.”
Bitcoin rises above $100,000 to start the week
The moves in crypto coincided with a rebound in tech stocks as Nvidia and shares of other chip names jumped. The tech-heavy Nasdaq was last higher by about 1.7%.
Crypto stocks Coinbase and MicroStrategy advanced nearly 6% and 5%, respectively. MicroStrategy Monday morning reported it has purchased another 1,070 bitcoins for about $101 million, bringing its total bitcoin holdings to 447,470.
Activity is coming back into the crypto market after a post-election rally that was driven by promises of a more supportive regulatory environment. The optimism sent prices rocketing for weeks before cooling at the end of the year. The price of bitcoin is expected to roughly double under the new administration this year, with some price predictions, like Fundstrat’s Tom Lee’s, being as high as $250,000.
Jakub Porzyck | Nurphoto | Getty Images
Global semiconductor stocks climbed on Monday after contract electronics giant Foxconn announced record fourth-quarter revenues, suggesting the artificial intelligence boom has far more room to run.
Hon Hai Precision Industry, which does business as Foxconn internationally, said in a Sunday statement that the company’s fourth-quarter revenue totaled 2.1 trillion New Taiwan dollars ($63.9 billion), growing 15% year-over-year.
Foxconn — which is a supplier to Apple — also set a record, posting the highest fourth-quarter revenue ever in company history, according to the statement.
The firm’s bumper revenue performance was driven by growth in its cloud and networking products — which includes AI servers like those designed by the likes of chipmaker Nvidia — and components and other products segments.
Computing products and smart consumer electronics — which numbers iPhone and other smartphones — saw “slight declines,” Foxconn said.
Shares of several semiconductor firms across Asia, Europe and the U.S. rose, as a result.
In Asia, TSMC hit a record high Monday and closed 1.9% higher in Taiwan.
The largest semiconductor manufacturer globally, TSMC produces chips for the likes of AMD and Nvidia.
Other Asian chip firms also logged share price gains — South Korea’s SK Hynix and Samsung rose nearly 10% and 4%, respectively.
In Europe, globally critical semiconductor equipment firm ASML saw its shares jump almost 6%, while fellow Dutch chip company ASMI’s stock rose almost 5%. Germany’s Infineon surged more than 6%.
Paris-listed shares of European contract chipmaker STMicroelectronics rose nearly 6%.
Stateside, Nvidia got a boost from the Foxconn numbers, climbing 2% in U.S. premarket trading.
Also boosting chip stocks on Monday was Microsoft’s announcement at the end of last week about plans to invest $80 billion in 2025 on data centers that can handle AI workloads.
Microsoft is one of several tech giants splurging on GPUs (graphics processing units) from Nvidia to train and run the most advanced AI models.
AMD, Nvidia’s closest rival, rose 3% in pre-market trading Monday, while fellow U.S. chip firms Qualcomm and Broadcom both climbed almost 2%.
-
Sports2 years ago‘Storybook stuff’: Inside the night Bryce Harper sent the Phillies to the World Series
-
Sports9 months agoStory injured on diving stop, exits Red Sox game
-
Sports1 year agoGame 1 of WS least-watched in recorded history
-
Sports2 years agoMLB Rank 2023: Ranking baseball’s top 100 players
-
Sports3 years ago
Team Europe easily wins 4th straight Laver Cup
-
Environment2 years agoJapan and South Korea have a lot at stake in a free and open South China Sea
-
Environment2 years agoGame-changing Lectric XPedition launched as affordable electric cargo bike
-
Business2 years agoBank of England’s extraordinary response to government policy is almost unthinkable | Ed Conway