Co-founder and CEO of Snap Inc. Evan Spiegel holds up a Pixy drone while speaking during the Viva Technology conference dedicated to innovation and startups, at the Porte de Versailles exhibition center in Paris, France June 17, 2022.
Benoit Tessier | Reuters
Snap has conducted a round of layoffs as part of a reorganization intended to streamline the social-messaging company.
Nearly 20 employees who held product management titles were laid off, Snap said in a statement on Wednesday. The layoffs were not centered on any specific product and were part of the company’s plans to increase decision-making speed and reduce overhead, the company said.
Technology news publication The Information reported on the layoffs earlier on Wednesday.
The layoffs come after Snap recently reported third-quarter earnings in which its overall sales grew 5% year-over-year to $1.19 billion, beating analyst expectations.
But Snap, like its larger rivalMeta, also warned investors that it has observed some recent pauses in advertising due to the current crisis in the Middle East. As a result, Snap said it would not provide official guidance “due to the unpredictable nature of war.”
Meta widened its guidance range due to the Israel-Hamas war, with the company’s chief financial officer Susan Li telling analysts that it “observed softer ads in the beginning of the fourth quarter, correlating with the start of the conflict.”
Last summer, Snap said it would lay off 20% of its workforce that was, at the time, comprised of over 6,000 employees.
Snap said it currently has roughly 5,000 employees.
Tesla will start deliveries of a revamped version of its Model Y SUV in the U.S. in March, according to new listings on the company’s website.
The Model Y Juniper has a price tag of $59,990, not including a federal tax credit of $7,500 for new electric vehicle purchases. It features a redesigned fascia, front and rear light bars and an upgraded interior with ventilated seats, reclining second-row seats and faster Wi-Fi, the website shows.
Tesla began taking orders for the new Model Y variant from customers in Canada and Europe on Thursday, and started sales in China about two weeks ago. CEO Elon Musk shared a video from the Tesla account on X Thursday night showing off the new Model Y.
Tesla is looking to revitalize its core automotive business, which faces increased competition across the globe. Executives are expected to discuss Tesla’s fourth-quarter and year-end results on Wednesday after markets close.
Tesla’s last new model, the angular steel Cybertruck, began rolling out to customers at the end of 2023. While it became the best-selling electric truck in the U.S. last year, sales didn’t make up for a decline in overall deliveries, which fell for the first time in 2024.
Musk, who also runs SpaceX and owns social media site X, has been at the center of attention in recent months because of his hefty financing of President Donald Trump’s 2024 campaign and his position in the newly elected president’s inner circle.
After his inauguration on Monday to begin his second White House term, President Trump signed an executive order indicating he will likely repeal the federal electric vehicle tax credit, which was approved by Congress during the Biden administration as part of the Inflation Reduction Act. Tesla has long benefited from the government-supported incentives, but ending the credits will likely have a more harmful impact on competitors in the EV market.
Prior to the release of the new Model Y variant, Musk’s political rhetoric, along with Tesla’s aging lineup, had led to a decline in the company’s reputation according to research from Brand Finance.
Twilio CEO Khozema Shipchandler speaks at Twilio’s Signal event in Sao Paulo on Aug. 14, 2024.
Courtesy: Twilio
Cloud communications software maker Twilio on Thursday issued a hopeful profit forecast for the next few years.
The company sees its adjusted operating margin widening to between 21% and 22% in 2027 as part of a three-year framework for guidance. That’s higher than Visible Alpha’s 19.68% consensus. Twilio’s adjusted operating margin in the most recent quarter was 16.1%.
Twilio revealed its new guidance at a Thursday investor event. There, the company’s executives also committed to generating $3 billion in free cash flow over the next three years, compared with approximately $692 million in free cash flow for 2022, 2023 and 2024. The Visible Alpha consensus for Twilio’s 2025 through 2027 was $2.76 billion.
The company’s stock price rose more than 10% in extended trading after the company released its presentation for the event.
If 2024 was about rebuilding Twilio’s foundation, 2025 is all about execution, CEO Khozema Shipchandler told CNBC ahead of the company’s investor day.
“If we execute well in 2025, I think we write our own story from 2026 on,” said Shipchandler, who joined Twilio as finance chief after 22 years at GE in 2018 and replaced co-founder Jeff Lawson as CEO in January 2024.
Twilio, which sends text messages and emails for customers, did not issue a revenue growth target for 2027 at its Thursday event.
Management on Thursday also provided guidance for 2025. It called for $825 million to $850 million in free cash flow and the same amount in adjusted operating income, with 7% to 8% revenue growth year over year. The Visible Alpha consensus was $814 million in adjusted operating income and about $808 million in free cash flow. The 2025 revenue forecast was in line with LSEG consensus.
Over 9,000 AI companies are already building on Twilio services. That includes OpenAI, which in December announced the 1-800-CHATGPT service that draws on Twilio voice tools.
“We want to be able to take a bunch more of those, as well as large enterprises on,” Shipchandler said. “We’re kind of open season on both.”
Shareholder pressure increases
After Twilio shares debuted on the New York Stock Exchange in 2016, investors piled in as the company delivered consistently high revenue growth rates. The stock drifted lower in 2022 as investors became more interested in profitable companies, with interest rates ratcheting upward. At the same time, Twilio’s revenue growth was slowing down.
Shareholder input influenced a reorganization that included a 17% workforce reduction in early 2023, and activist investors Anson Funds and Legion Partners Asset Management agitated for a sale of Twilio or one of its business units, CNBC reported.
Since activist investor Sachem Head Capital Management won a Twilio board seat last April, Twilio’s stock has jumped about 81%, as revenue growth has accelerated and losses have narrowed.
Twilio has an opportunity to show double-digit growth in 2025 and beyond, Mizuho analysts said in a note earlier this month. The analysts have the equivalent of buy rating on the stock.
By expanding into new areas, such as conversational artificial intelligence, Twilio says it can sell into a $158 billion total addressable market by 2028, compared with $119 billion when only focusing on the communications and customer data platform categories.
The company doesn’t believe acquisitions will be necessary to reach its new total addressable market, a spokesperson said.
Twilio’s preliminary results for the fourth quarter show 11% revenue growth, with adjusted operating income that exceeds the top end of the $185 million to $195 million range that the company issued in October. Analysts surveyed by LSEG had expected 7.9% revenue growth, and according to Visible Alpha, the adjusted operating income consensus was about $190 million.
Google on Thursday blamed a “data error” after users reported that former President Joe Biden was missing from the company’s search results.
Users on Wednesday noticed that results for search queries that included “US Presidents,” “United States Presidents” and “US Presidents in order” did not include Biden, who concluded his four-year presidential term on Monday. Users reported seeing a list of presidents ranging from George Washington to President Donald Trump. Some users posted screenshots of their results showing how the lists omitted Biden.
CNBC tried searching for U.S. presidents on Wednesday night and also encountered the results that omitted Biden. The company restored Biden to its results on Thursday.
“There was a brief data error in our knowledge graph,” a company spokesperson said in an emailed statement to CNBC on Thursday. A knowledge graph is a broad term used to describe a system that holds connected information. “We identified the root cause and resolved it quickly.”
Google’s search results for “United States Presidents” omitted President Joe Biden, who ended his four-year term Monday.
The mistake comes after Google CEO Sundar Pichai sent a memo to employees on Election Day in November, asking them to remember that people turn to the company’s services for “high-quality and reliable information.”
“Whomever the voters entrust, let’s remember the role we play at work, through the products we build and as a business: to be a trusted source of information to people of every background and belief,” Pichai wrote. “We will and must maintain that.”
Google’s Biden omission error comes as the company undergoes a turbulent period that has included several product mishaps and global scrutiny.
“It’s not lost on me that we are facing scrutiny across the world,” Pichai said in a December all-hands meeting first reported by CNBC.“It comes with our size and success. It’s part of a broader trend where tech is now impacting society at scale.”
Amid a year of product mistakes, Google launched Imagen 2, which turned user prompts into artificial intelligence-generated images. Immediately after it was introduced, the product came under scrutiny for historical inaccuracies discovered by users. The company pulled the feature for months before relaunching it, and Pichai told employees the company had “offended our users and shown bias.”
Google also faced problems with its AI summaries product AI Overview atop Google’s traditional search results, where users were also quick to find problems upon that launch.
Pichai has been among tech CEOs getting closer to Trump, who has previously alleged that Google intentionally buried search results of him. Those allegations are unproven.
Google donated $1 million to Trump’s inauguration fund, becoming one of several tech companies working to curry favor with the new administration. Pichai had a prominent standing position on stage alongside other tech CEOs at Trump’s inauguration Monday.