Elon Musk’s Twitter Reveals 50 Percent Drop in Ad Revenue – No Shock to Followers
Elon Musk has acknowledged that Twitter’s financial condition is still suffering, with a significant 50 percent decline in ad revenue. This revelation is quite astonishing, although it shouldn’t come as a shock to those who have been monitoring Twitter’s business progress throughout the years.
Musk reportedly paid $44 billion to buy Twitter last year, a much higher value than what Twitter should command. But that’s how it went, and Musk promised that he wants to monetize Twitter faster than the previous management.
He decided to bring a bunch of new features, including using Twitter Blue to monetize the platform. But he was also working against much of Twitter’s workforce, including engineers, which has meant the app has undergone a major overhaul in a short period of time.
We’re still negative cash flow, due to ~50% drop in advertising 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
Twitter Blue has many features, including a promise to show you fewer ads. While this is positive for the user, businesses see the effects of such a move, limiting their reach on the platform, which always results in these businesses moving away from Twitter and taking their money to another platform.
Musk has talked about luxury in his statement about negative earnings, but most of his business decisions have put the platform in its current position, which has only gotten worse since he took over the company.
Twitter has struggled to pay its office rent, paid for cloud services a few weeks ago, reported massive outages during this time, and more. The top management that led the deal to sell Twitter has made a killing selling it, and Musk has managed to get himself a product that he may eventually have to give up and cut his losses sooner rather than later.
