Twitter’s Chief Executive Elon Musk has stated that the social media platform could achieve cash flow positivity next quarter, as the company has been aggressively cutting costs. Musk spoke at a Morgan Stanley investor conference and expressed how “startling” it was that Twitter had not managed to make money off its messaging service. He explained that Twitter had reduced its non-debt expenditures to $1.5 billion from a projected $4.5 billion in 2023, by cutting its cloud services bill by 40% and closing one data centre. Twitter has also laid off thousands of employees, as part of cost-cutting measures.
Musk, who is also the CEO of electric car maker Tesla, acquired Twitter for $44 billion in October 2022. The company also faces annual interest payments of about $1.5 billion as a result of the debt it took on in the take-private deal, according to Musk. He also mentioned that Twitter had been impacted by a “massive decline in advertising,” partly due to the cyclical nature of ad spending and partly due to “political” reasons.
Twitter has faced instability and uncertainty since the acquisition by Musk. On Monday, it suffered a bug that prevented thousands of users from accessing links, marking its sixth major outage since the beginning of the year. Musk stated that what had been intended as a small change to 1% of users ended up being a “catastrophic” change for all and that engineers were currently doing a “clean up” of the Twitter software code.
Concerns about Twitter’s stability have been widespread since the acquisition by Musk, with many engineers responsible for fixing and preventing service outages leaving the company, according to sources. Musk expects it will take a few years to build a management team at Twitter, and had previously stated that the end of this year would be “good timing” to find a new CEO to run the social media platform.
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