Given that advertising revenue has decreased by 50% since Elon Musk took control of the social media platform, Twitter’s cash flow is still negative.
After predicting in March that cash flow would be positive by June, Mark Zuckerberg’s rival made the admission months later.
Musk responded to a tweet about the company’s recapitalization on Saturday by revealing the cashflow situation. “We still have a negative cash flow because of the heavy debt load and a 50% drop in advertising revenue,” according to Musk.
“We must achieve positive cash flow before we can afford anything else.”
Even though the business did not experience the growth in advertising revenue that was anticipated in June, he reiterated on Sunday that they are hoping for growth in the upcoming weeks.
“July is a little bit more promising,” he said.
More than half of Twitter’s top 1,000 advertisers started to cut back on their spending on the platform after Musk finished his full takeover of the social media platform last fall.
According to a report, by January, 625 advertisers had stopped spending money on advertisements, including Coca-Cola, Jeep, Wells Fargo, and Merck. As a result, from October through January 25, advertising revenue decreased by 60% each month.
However, Musk revealed in June at a tech conference in Paris that almost all of the advertisers who withdrew their funding were coming back to the website.
According to a report, he claimed that “almost all of the advertisers have sad that, they’ve either come back or they said they will come back.”
Musk took over Twitter and has since implemented a number of contentious policy changes that have been criticized by both current and former users.
Musk made a number of changes, including lifting previous bans on users who disobeyed Twitter’s rules and switching verification checkmarks to a paid-monthly subscription.
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