July 16, 2024

Elon Musk said Twitter is recovering financially after seeing ad revenue drop by 50%, in his first public disclosure of the social media company’s status since buying it last year.

Speaking at a conference hosted by Morgan Stanley on Tuesday, Twitter’s new owner, Musk, said he had taken drastic steps to improve the company’s finances, cutting some $3 billion in operating expenses. After layoffs, the company has an opportunity to be cash flow positive in the second quarter, he said.

In the interview, moderated by Morgan Stanley banker Michael Grimes, who helped broker Mr. Musk’s $44 billion takeover of Twitter, the billionaire said that if he hadn’t cut costs, it would have The company “will be bankrupt within four months.” Since closing the acquisition in late October, Mr. Musk has laid off or laid off more than 3,750 employees, left suppliers and landlords without payments, and eliminated cloud computing costs and one of Twitter’s three main data centers.

“Twitter will have $6 billion in costs and $3 billion in revenue if no action is taken,” Mr. Musk said. He added that earlier forecasts showed costs of $4.5 billion and sales of $4.5 billion. Twitter reported $5.1 billion in revenue for 2021, up 37% from the previous 12 months, in its financial results reported for the previous full year.

Mr. Musk, however, appears to take little responsibility for the change in the company’s financial outlook. According to him, he owes $1.5 billion a year to pay off the debt he took on to close the deal. Its ad sales fell, which accounted for about 90% of the company’s revenue in previous years, as advertisers pulled back as brands worried about a rise in hate speech and misinformation.

He said the decline in advertising was partly “cyclical” and partly “political,” and blamed advertisers’ concerns on how the company was portrayed in the news media.

“Trust what you read on Twitter, not what you read in the paper,” Mr. Musk said.

Before Mr. Musk came along, Twitter dealt with a series of outages and glitches that became more common under his leadership. On Monday, a bug prevented many users from clicking links, loading images or accessing certain parts of the site.

Mr. Musk also spent part of Monday and Tuesday sparring with a former employee on Twitter. After Haraldur Thorleifsson, an Icelandic employee whose design firm was acquired by Twitter, clarified to the billionaire on Twitter whether he had been fired, Mr. Musk accused him of using disability as an “excuse” for not working and claimed he was seeking “a job.” Big money.” (Mr Thorleifsson has muscular dystrophy and requires a wheelchair.)

Although Mr Thorleifsson said on Twitter that he finally did received confirmation He has been fired and is still awaiting word on whether he will “pay what I owe under the contract”. Due to the acquisition of his company by Twitter, Thorleifsson is paid more than most employees and is expected to receive full compensation if he is fired.

“My company was acquired, so I was obligated to work at Twitter for a while,” Mr. Thorleifsson said in an email to The New York Times. “I fulfilled all aspects of the contract, now I need to wait and see if Twitter will do the same.”

On Tuesday, ahead of his speech at the Morgan Stanley conference, Musk continued to attack him, calling Tolefson “the worst possible person.” He later deleted the tweet.

Then, in series of follow-up postsAfterwards, Mr Musk said he had a video call with Mr Saul Lefson on Tuesday afternoon and apologized for his “misunderstanding”. The billionaire said he had offered Mr Tolefson his job offer.

“Talking to a human is better than tweeting,” Mr. Musk tweeted.

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