The last few months have been “extremely hard”but Twitter is “now trending towards breakeven”. That’s how the CEO Elon Musk he said in a tweet adding that he had to “saving twitter from bankruptcy” while working at his other companies, Tesla and Space X.
“I wouldn’t wish this pain on anyone”he wrote. “Twitter still has challenges ahead, but it is now tending towards breakeven if we continue to do so. The support of the public is greatly appreciated!”.
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Since the $44 billion buyout talks began late last year, Twitter has proven to be a difficult acquisition for “Mr. Tweet”.
Second the Platformer technology newsletter, Twitter’s daily revenue fell 40% year-over-year in January 2023 as hundreds of Twitter’s top advertisers halted or reduced spending.
One company estimated that Twitter’s ad revenue decline was as much as 70% in December, year-on-year, Reuters reported.
Some of the changes implemented by Musk in Twitter, such as the restoration of the accounts of controversial figures, including neo-Nazi website founder Andrew Anglin, have prompted brands to abandon the platform and outrage from civil rights leaders.
In a November tweet, Musk admitted that the company has suffered a “huge drop in revenue” after advertisers suspended advertising investments in the social media platform.
In late 2022, Musk said Twitter was no more “in the fast lane to bankruptcy”but it wasn’t yet “Safe” of which as he was able to point out during an episode of the All-In Podcast with his longtime friends, who are also investors in Twitter: angel investor Jason Calacanis; and Craft Ventures co-founder and partner David Sacks.
Since Elon Musk took the lead, Twitter has also been sued for the non-payment of various partners, suppliers and former employees.
For example, Florida-based Private Jet Services sued Twitter for failing to pay $197,725 for its transportation services.
In another case, the owner of the Twitter headquarters in San Francisco is suing the company over alleged failure to pay approximately $6.8 million in rent during December and January.
Under Musk’s management, Twitter cut headcount through mass layoffsother layoffs and internal changes that have forced many to resign, including the end of smart working launched under former CEO Jack Dorsey.
Labor attorney Shannon Liss-Riordan introduced hundreds of requests for arbitration and a proposed class action lawsuit against Twitter on behalf of the affected employees.
According to a tweet from January, the lawyer claims that the former Twitter employees fired or forced out must receive a higher severance package to that offered by the Musk team.
In addition to cutting costs, the company has been trying to create new lines of revenue or income.
In January of this year, Twitter auctioned everything, from kitchen supplies to office equipment.
The company also launched – and relaunched – an upgraded subscription service to Twitter Blue in December, after Musk pulled out and delayed service to November.
Musk recently decided to charge researchers for access to the company’s API and phase out free access. In a tweet on Sunday, a Twitter user expressed concern about the amount Musk had on his plate. “I’m worried about myself too”, Musk wrote in response.