Sept 14 (Reuters) - Twilio Inc said on Wednesday it plans to cut its staff by nearly 11% as the cloud communications platform joins other tech companies in reducing costs and shoring up margins amid a slide in demand for cloud services.
Shares of the San Francisco-based company, which said its restructuring will be completed by the end of the fourth quarter, rose nearly 3% in morning trade.
Twilio had hired aggressively during the pandemic to cater to booming demand for cloud service providers from businesses looking to operate amid lockdowns. Employee count jumped to 7,867 by the end of 2021 from 4,629 in 2020.
Companies such as Snap Inc and Shopify Inc have also resorted to similar measures as they attempt to mitigate the impact of lower demand amid record-high inflation and higher cost of capital from peaking interest rates.
Twilio's revenue had boomed at the peak of the pandemic but the growth rate has since inched lower, with second-quarter sales growth at 41%, the lowest since the December quarter in 2017.
The company, whose stock has fallen about 73% this year, also reiterated its third-quarter forecast, according to a filing.
Twilio estimates it will incur between $70 million and $90 million in charges over its restructuring plan which includes staff layoffs, with the majority to be incurred in the third quarter of 2022.
The company faced a cyber attack last month that compromised data of about 163 customers. The company, which has notified the affected people, has not disclosed any financial impact of the breach.
(Reporting by Tiyashi Datta and Yuvraj Malik in Bengaluru; Editing by Vinay Dwivedi)
