Popular social media platform Twitter is reportedly struggling to maintain its financial stability months after it was purchased by tech mogul and investor Elon Musk for a hefty $44 billion. Musk revealed on Saturday that the platform has suffered a massive 50% drop in advertising revenue, leading to negative cash flow and a burden of heavy debts.
In a candid response to a user offering suggestions on financing for the platform, Musk stated, “We’re still negative cash flow, due to ~50% drop in advertising revenue plus heavy debt load. Need to reach positive cash flow before we have the luxury of anything else.”
We’re still negative cash flow, due to ~50% drop in advertising revenue plus heavy debt load. Need to reach positive cash flow before we have the luxury of anything else.
— Elon Musk (@elonmusk) July 15, 2023
The billionaire, however, refrained from expanding further on the matter.
Since Musk’s takeover, a series of alterations implemented on Twitter have managed to alienate both users and advertisers. Technical glitches have become a recurrent issue on the platform boasting approximately 200 million regular users in recent times.
Adding to users’ frustration, Musk recently announced that the number of tweets users can view daily will be temporarily limited as Twitter would be imposing temporary limitations on verified accounts and those subscribed to Twitter Blue, restricting their daily tweet reading capacity to 10,000 tweets.
Unverified users and non-subscribers, who comprise the majority of Twitter’s user base, will be limited to reading only 1,000 tweets per day. Furthermore, new unverified accounts will have a maximum limit of 500 tweets.
This announcement prompted a surge of users flocking to alternative social media platforms, including Truth Social and the newly introduced Meta app Threads.
In response to the fierce competition, Twitter threatened to take legal action against Meta, accusing the Facebook parent company of stealing its trade secrets.
In a letter Twitter’s lawyer Alex Spiro sent to Meta CEO Mark Zuckerberg, the company claimed that its former employees currently working at Meta “had and continue to have access to Twitter’s trade secrets and other highly confidential information.”
“Twitter intends to strictly enforce its intellectual property rights, and demands that Meta take immediate steps to stop using any Twitter trade secrets or other highly confidential information,” the letter read.
Meta has however denied the allegations, stating that “no one on the Threads engineering team is a former Twitter employee.”
