Elon Musk says Twitter is 'deep in debt'

Elon Musk once said Twitter would have positive cash flow before the second quarter of 2023, but now admits it can't reach this goal.

"We are still in a negative cash flow situation due to a 50% drop in ad revenue plus a heavy debt load," Musk replied to one account when asked about Twitter's situation late on July 15. "We need to hit our positive cash flow target before we can think of anything else luxuries."

Elon Musk at the Met Gala event in the US in May 2022. Photo: Reuters

This is the rare time Musk has acknowledged a drop in ad revenue from Twitter. Since the end of last year, a series of large advertisers have left the platform. Earlier this year, the US billionaire said they were making a comeback and "positive money is coming to Twitter". In April, he continued to assert that "virtually all advertisers have returned or said they will come back".

However, data from third parties does not show that. According to estimates by market research firm Sensor Tower, the amount of money poured into advertising on Twitter in the first two months of the year fell 89 percent to $7.6 million. In the two months of September and October 2022 before Musk took over, the top 10 advertisers spent $71 million on the platform.

Twitter is currently facing many difficulties since Musk's acquisition and constantly changing its policies. Most recently, the Twitter boss controversially introduced account limits for users. Twitter Blue subscribers can view up to 10,000 posts per day, unverified but long-established accounts will see 1.00 posts, while newly created accounts can only view 500 posts.

In response to users, Musk said this is a measure to prevent organizations from getting data from Twitter to train AI. "Hundreds of organizations are collecting Twitter data so aggressively that it affects the user experience," he said.

Twitter is also constantly experiencing problems, such as service interruptions, API glitches, and broken tweet links when sharing. According to The Verge , while blaming companies for collecting data to train AI, the limit on views could also come from the social network's financial problems.

According to Bloomberg , Twitter will be even more difficult next time, when Mark Zuckerberg has just launched a similar platform called Threads and reached a record of 100 million users in just 5 days. While Threads continues to grow in terms of users, Twitter has been on a downward trend in traffic lately.

Bao Lam

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