Twitter is still losing money, according to Elon Musk, because advertising has decreased by 50%.
Musk tweeted on Saturday that “We’re still negative cash flow, due to (about a) 50% drop in advertising revenue plus a heavy debt load.” This was in response to a tweet that offered business advice.
Before we can afford anything else, we must have positive cash flow, he added.
Musk has made an effort to reassure advertisers who were worried about the firing of key executives, mass layoffs, and a different approach to content moderation ever since he acquired Twitter in a $44 billion acquisition last autumn.
Some prominent users who had been banned were permitted to return to the website. Musk claimed in April that the majority of the departed advertisers have returned and that the business may experience positive cash flow in the second quarter.
He appointed Linda Yaccarino, a senior executive at NBCUniversal with strong ties to the advertising sector, as his new CEO in May.
However, Twitter has since displeased some users by imposing additional restrictions on how many tweets they can view in a day, and other users have complained that they were locked out of the service.
According to Musk, the limitations are necessary to stop unlawful data scraping that may be profitable.
This month, Facebook owner Meta introduced Threads, a text-focused app, to the market.
Within a short period of time, Threads racked up tens of millions of sign-ups, giving Twitter a new rival. Twitter answered by expressing concern over legal action.