Elon Musk says Twitter’s cash flow still negative as ad revenue drops 50 per cent

Twitter’s money circulation stays damaging due to a virtually 50 per cent drop in promoting income and a heavy debt load, Elon Musk stated on Saturday, falling wanting his expectation in March that Twitter might attain money circulation constructive by June.

“Need to reach positive cash flow before we have the luxury of anything else,” Musk stated in a tweet replying to options on recapitalization.

This is the newest signal that the aggressive cost-cutting measures since Musk acquired Twitter in October alone should not sufficient to get Twitter to money circulation constructive, and suggests Twitter’s advert income could haven’t recovered as quick as Musk recommended in an interview in April with the BBC that the majority advertisers had returned to the location.

After shedding hundreds of staff and slicing cloud service payments, Musk had stated the corporate decreased its non-debt expenditures to $1.5 billion from a projected $4.5 billion in 2023. Twitter additionally faces annual curiosity funds of about $1.5 billion because of the debt it took on within the $44 billion deal that turned the corporate non-public.

It is unclear what timeframe Musk was referring to by the 50 per cent drop in advert income. He has stated Twitter was on monitor to put up $3 billion in income in 2023, down from $5.1 billion in 2021.

Twitter has been criticized over lax content material moderation, adopted by an exodus of many advertisers who didn’t need their adverts showing subsequent to inappropriate content material.

Musk’s hiring of Linda Yaccarino, former advert chief at Comcast’s NBCUniversal as CEO, signaled that advert gross sales are a precedence for Twitter at the same time as it really works to extend subscription income.

Yaccarino began working at Twitter in early June and has advised buyers Twitter plans to concentrate on video, creator and commerce partnerships and is in early talks with political and leisure figures, funds companies, and news and media publishers.

On Thursday, Twitter stated that choose content material creators will likely be eligible to get part of the advert income the corporate earns in an try to attract extra content material creators to the location.

(Reporting by Jahnavi Nidumolu in Bengaluru; modifying by Grant McCool)