TechnologyMusk doesn't rule out Twitter bankruptcy

Musk doesn’t rule out Twitter bankruptcy

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Bring more money than spend – that’s what Elon Musk swears at his employees. Twitter could potentially face billions of losses because of this.


Tech billionaire Elon Musk hasn’t ruled out the bankruptcy of the online service just weeks after his $44 billion Twitter takeover. When he appeared before employees on Thursday, he warned Twitter’s balance sheet could face a billion-dollar gap next year, media reports.

Musk quoted financial service Bloomberg as well as tech media “The Information” and “Platformer” that “bankruptcy cannot be ruled out” if it is not possible to bring in more money than we spend under these circumstances. Twitter was already in the red before it took over.

Musk complains about the drop in sales

After the deal, Musk lamented the drop in sales as some major advertisers suspended ads on the platform. They worry that if Musk relaxes content rules as announced, their ads could appear alongside offensive tweets.

The 13 billion dollar loan that Musk issued for the purchase also weighs on Twitter. According to media reports, it costs about a billion dollars a year to pay off this debt.

Under Musk, Twitter relies on a subscription model

Tech billionaire wants ad revenue so far 90 percent of income make up, complete with a subscription job. Launching her new subscription with a verification checkmark initially caused chaos as some users deceptively impersonated celebrities and companies with real-looking fake accounts.

Musk previously warned employees of the tough times in an email. The economic situation is “bad”, especially for a company that depends on advertising revenue.

Musk removes home office option for employees

In the memo, Musk also announced new guidelines for working from home – working from home in the future will only be allowed with his express personal leave. According to the memo, which is constantly quoted by the US media, employees must be in the office at least 40 hours a week.

Prior to the takeover, Twitter employees were allowed to work from anywhere. Musk is seen as a competitor to the home office trend – he’s already made this clear with electric car company Tesla. Musk also cut every second of nearly 7,500 jobs on Twitter last week.

He said that now the company still has too many employees in some cases, according to reports. Two other key executives left the company on Thursday: Yoel Roth, who was responsible for filtering out objectionable content, and Robin Wheeler, who was recently in charge of advertiser relations.

Source: ZDF

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