Twitter saved from bankruptcy and on track to break even, Elon Musk says

The social media company still has challenges, the billionaire owner warns

A view of Twitter headquarters in San Francisco, California.   EPA
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Twitter has been saved from bankruptcy, according to its owner Elon Musk.

The billionaire acquired the social media company in October for $44 billion, and revealed soon after that it was losing $4 million a day and facing the risk of going bankrupt.

A major cost-cutting operation followed.

However, Mr Musk tweeted on Sunday that the company was now in a stronger financial position.

“Last 3 months were extremely tough, as had to save Twitter from bankruptcy, while fulfilling essential Tesla & SpaceX duties,” he said.

“Wouldn’t wish that pain on anyone. Twitter still has challenges, but is now trending to break even if we keep at it. Public support is much appreciated!

“To be extra clear, Twitter is definitely not financially healthy yet, but is trending to be so. Lots of work still needed to get there.”

In December, Mr Musk likened the company to a “plane that is headed towards the ground at high speed with the engines on fire, and the controls don’t work”.

“Twitter has had a massive drop in revenue due to activist groups pressuring advertisers, even though nothing has changed with content moderation and we did everything we could to appease the activists,” Mr Musk said in a tweet on November 4.

Twitter lost at least half of its major advertisers in the weeks after Mr Musk became chief executive, representing a loss of about $750 million, a report by non-profit Media Matters found.

Since October, he has reportedly fired more than half of the 7,500 employees at Twitter.

In an effort to bring in new revenue, he introduced the Twitter Blue subscription service, which adds a blue checkmark to an account and offers early access to features such as edit tweet, NFT profile pictures and custom app icons, as well as longer videos in exchange for a monthly fee.

The service was last week expanded to six more countries, including Saudi Arabia, taking the total number of countries it is available in to 12.

Also last week, Twitter announced that it would end free API access, with a paid basic tier to be available instead.

As there is no verification process or cost, it is “easy to spin up 100k bots to do bad things”, Mr Musk said.

“Just ~$100/month for API access with ID verification will clean things up greatly.”

Another method to raise revenue that has been under consideration is to put popular usernames up for auction, the New York Times reported.

Mr Musk is also moving ahead with plans to introduce a payments feature on its platform. The company has applied for regulatory licences across the US.

And Twitter held an auction of items from its San Francisco headquarters, with a bird logo statue selling for $100,000.

Mr Musk has not commented on the auction and it is not known how much money was raised from it.

Twitter will, however, start sharing advertisement revenue with some content creators, Mr Musk said on Friday.

While he did not specify the actual share creators would receive, he did confirm the account must be a subscriber to Twitter Blue Verified.


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Updated: February 06, 2023, 7:02 AM