Elon Musk claimed on Saturday that Twitter’s cash flow remained negative due to a roughly 50% decline in advertising revenue and a large debt load, falling short of his March prediction that Twitter will be cash flow positive by June.
This is the latest indication that Musk’s aggressive cost-cutting measures since acquiring Twitter in October are insufficient to get Twitter to cash flow positive, and it suggests that Twitter’s ad revenue may not have recovered as quickly as Musk suggested in an April interview with the BBC that most advertisers had returned to the site.
Musk stated that the business decreased its non-debt expenses to $1.5 billion from a predicted $4.5 billion in 2023 after laying off thousands of staff and slashing cloud service bills. Twitter now faces annual interest payments of approximately $1.5 billion as a result of the $44 billion purchase that took the firm private.
The time span Musk was referring to by the 50% decline in ad revenue is unknown. He stated that Twitter was on course to generate $3 billion in revenue in 2023, a decrease from $5.1 billion in 2021.