Elon Musk acknowledges Twitter’s current financial challenges, attributing them to a 50% decrease in advertising revenue and a significant debt burden.
In response to a tweet offering business advice, Musk stated on Saturday, “We’re still experiencing negative cash flow due to a substantial drop in advertising revenue and the weight of heavy debt. We must achieve positive cash flow before considering other luxuries.”
Since acquiring Twitter in a $44 billion deal last autumn, Musk has worked to reassure advertisers despite the departure of top executives, extensive layoffs, and a different approach to content moderation. Notably, some previously banned high-profile users were allowed back on the platform.
In April, Musk announced that most of the advertisers who had left had returned and suggested that the company might achieve positive cash flow in the second quarter.
In May, he appointed Linda Yaccarino, a former NBCUniversal executive with deep connections to the advertising industry, as the new CEO.
However, Twitter faced user backlash for implementing new limits on tweet views per day, leading to users being locked out of the platform. Musk justified these restrictions as necessary to prevent unauthorized extraction of potentially valuable data.
Recently, Twitter faced competition from Meta, the owner of Facebook, with the launch of Threads, a text-oriented app that gained millions of sign-ups within days. In response, Twitter threatened legal action.
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