Twitter owner Elon Musk said on Saturday that Twitter's cash flow remains negative due to a nearly 50% decline in ad revenue (advertising income) and heavy debt. Responding to suggestions on recapitalization, Musk said in a tweet that we need to reach positive cash flow before we can enjoy anything.

It is the latest sign that the cost-cutting measures taken since Musk acquired Twitter in October have not been enough to make Twitter's cash flow positive. This suggests that Twitter's advertising revenue has not grown as fast as Musk had thought.

Twitter slashes non-debt expense
Let us tell you that after the recent employee layoffs and reduction in cloud service bills, Musk said that the company has reduced its non-debt expenses from an estimated $ 4.5 billion to $ 1.5 billion in 2023. Significantly, Twitter has to pay annual interest of about $ 1.5 billion due to debt.

Claims to earn revenue of three billion dollars in 2023
It is not clear at the moment what is the time frame for the 50% drop in advertising revenue claimed by Musk. He has said that Twitter is on track to earn three billion dollars in revenue in 2023. That's down from $5.1 billion in 2021.

Criticism about content moderation
Twitter has also been criticized for content moderation. After this many advertisers have left the platform. They didn't want their ads to appear next to inappropriate content.

Ad sales crucial for Twitter
As such, Musk's hiring of NBC Universal's former advertising head Linda Yacarino as CEO signals that it is important for Twitter to prioritize ad sales.

Twitter focused on commercial partnership
Explain that Yacarino started working for Twitter in early June and told investors that Twitter plans to focus on video, creators, and commercial partnerships. For this, the platform is in talks with political and entertainment personalities, payment services, and news and media publishers.

Last Thursday, Twitter said that select content creators would give a portion of the advertising revenue earned by the company to attract more content creators to the site.

(pc amarujala)