2023-07-16 21:44:08
Via a post shared on Twitter this Saturday, July 15, Elon Musk admitted having lost almost half of the revenue linked to the social network, bought for 44 billion dollars, or nearly 40 billion euros, in October 2022.
Finances plunging after a series of contested decisions. In a tweet relayed on Saturday in response to a user questioning him on this subject, Elon Musk confirmed the loss of almost half of the revenue linked to the social network.
“We are still in a negative cash flow situation, due to an approximately 50% drop in revenues and the heavy debt load. We need to get to positive cash flow before we have the luxury of doing anything else,” the Tesla CEO tweeted.
We’re still negative cash flow, due to ~50% drop in revenue plus heavy debt load. Need to reach positive cash flow before we have the luxury of anything else.
— Elon Musk (@elonmusk) July 15, 2023
Market research firm Sensor Tower estimated advertiser spending on Twitter fell 89% to $7.6 million, or €6.76 million, for two months earlier this year. Last May, the firm “Insider Intelligence” assured that the social network would reap less than 3 billion dollars (or 2.67 billion euros) in profits in 2023, almost a third less than the year last.
A series of decisions that displeased the fans
Since taking control of the social network last October, the billionaire has made controversial decisions with his community. Last July, it restricted the reading of tweets to 10,000 per day for verified accounts, 1,000 for others and even 500 for new accounts. A few days later, he announced the restriction in the coming months of the popular application TweetDeck, making it only accessible to verified accounts.
The disinterest of fans in the platform was therefore materialized by poor financial results for the group in the first half of 2023. Last April, Elon Musk had however assured that the majority of advertisers had returned to the platform. In the process, he had promised a return to financial equilibrium in the last quarter, which was far from being reflected in the latest balance sheets communicated.
Twitter threatened by competitor Threads
At the same time, the launch of a major competitor, namely Mark Zuckerberg’s Threads project, represented a first major threat to Twitter. The Facebook founder’s app surpassed 100 million users within days of its official launch.
Encouraging figures for Threads, especially since the Meta application can count on synergies with Instagram, totaling nearly two billion active users.
Additionally, Threads offers a more accessible system for getting a verified account, which is a simple ID verification. A fast and free process, unlike Twitter which requires a subscription to a paid subscription to access it.
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