Business at the short message service Twitter is worse than expected: According to company boss Musk, the company recorded a 50 percent drop in advertising revenue.
The short message service Twitter recorded a massive slump in its advertising revenue. Twitter owner Elon Musk wrote in the online service that the company continues to post negative cash flow because advertising revenue has fallen by around 50 percent. In addition, the debt burden is still very high.
In March, Musk said he expected Twitter to be cash flow positive by June. “We need to achieve positive cash flow before we can afford the luxury of anything else,” the entrepreneur wrote.
In 2021 sales will still be 5.1 billion dollars
Musk responded to a tweet about proposals to recapitalize the company. It was initially unclear to what period Musk was referring to his statement about a 50 percent drop in advertising revenue. He has previously said Twitter is on track to hit $3 billion in revenue by 2023, up from $5.1 billion in 2021.
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The technology billionaire bought the online service in October 2022 for 44 billion dollars (40.15 billion euros). He had taken over the top post at Twitter himself, taken the company public and laid off thousands of employees – most of the workforce. He also reduced the moderation of the content distributed there – but this is very important for potential advertisers who want to present their offers in a positive environment.
Other decisions have also put off advertisers, but also many users: At the beginning of July, Musk decided to limit the number of tweets that non-paying users could read every day. And the Tweetdeck application will only be available to paying users in the future.
The industry observer Insider Intelligence had therefore predicted in May that Twitter will take less than three billion dollars this year – compared to the previous year that would be a slump of 28 percent.
The billionaire Musk is also the boss of the electric car supplier Tesla and several other companies.