Elon Musk, owner of the social network Twitter, revealed this weekend that the company has lost half of its advertising revenue since he bought it for $44 billion in October 2022.
He also said that the platform had not experienced the increase in sales that was expected for the month of June, although he added that July was being “somewhat more promising.”
Musk laid off about half of Twitter’s 7,500 workers to try to save costs.
Its rival Meta app, Threads, already has 150 million users after just over a week of release, by some estimates.
By being connected to Instagram, Threads has automatic and potential access to its 2 billion users.
Meanwhile, Twitter is struggling with a heavy debt load and, according to Musk, the flow of funds remains in the red.
“We need to get cash flow positive before we can afford anything else,” the billionaire tweeted.
Lucy Coutts, chief investment officer at JM Finn, a wealth management firm, told the BBC’s Today show that she believes Musk will turn the tide on Twitter, “although it will take longer.”
“But unfortunately it has a debt of US $ 13,000 million that must be paid by the end of Julyso we will see more pressure on Tesla stock if Musk has to sell more of his stake in that company,” Coutts added.
Musk is also the chief executive officer and major shareholder of Tesla, the maker of electric cars.
After laying off thousands of employees and slashing cloud service bills, Musk said Twitter was on track to record revenue of $3 billion in 2023below US$5.1 billion in 2021.
The losses indicate that aggressive cost-cutting measures have not been enough to lure back many advertisers who left the platform after changes to content moderation policies.
During an interview with the BBC in April, Musk suggested that most advertisers had already returned to the platform.
However, Meghana Dhar, a former head of partnerships at Snap and Meta, points out that many of Twitter’s problems date back to before Musk’s arrival.
“Elon and Twitter are in a difficult position right nowIn fairness, though, we’ve seen this drop in growth and revenue from Twitter since before the purchase. There’s been kind of a steady decline.”
Linda Yaccarino, a former head of advertising at NBCUniversal, was hired as Twitter’s chief executive in June, a move that suggests ad sales remain a top priority for the company.
Yaccarino has commented on Twitter’s plans to focus on video partnerships, creators, and commerce. The company is reportedly negotiating deals with personalities from politics and entertainment, payment services, and media and news sites.
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Source: La Opinion
