Maybe the logic is that market is already aware that the company is not in good shape and this is reflected in the stock price. Massive layoffs tell the management is now also realising this and doing something about it, which is then thought to be a good thing.

Another explanation could be that massive layoffs has caused stock uptick in the past and therefore it makes sense to bet that the same thing will also happen this time. (Of course this only makes sense for those who are first to react to the news)