Twitter is projected to generate $3 billion (£2.29 billion) in revenue in 2023, down from $5.1 billion (£3.89 billion) in 2021, according to Musk.
Since Elon Musk acquired Twitter for $44 billion (£33.6 billion) in October of the previous year, the company’s owner claims that advertising revenue has significantly decreased.
The expected increase in receipts for June did not materialize as anticipated, although there are indications of improvement in July. Upon taking over in 2022, Musk initiated a cost-cutting strategy that resulted in the dismissal of approximately half of Twitter’s 7,500 employees.
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A rival app called Threads has reportedly amassed 150 million users, providing the Meta-designed platform with access to a potential two billion users due to its integrated connection with Instagram. In contrast, Twitter has struggled with a substantial debt burden and negative cash flow, as Musk acknowledged.
However, he did not provide a specific timeline for the reported 50% drop in ad revenue. Musk emphasized the need to achieve positive cash flow before addressing other priorities.
Despite layoffs and reductions in cloud service expenses, Twitter is projected to generate $3 billion (£2.29 billion) in revenue in 2023, down from $5.1 billion (£3.89 billion) in 2021, according to Musk.
This development highlights the ongoing challenge of attracting advertisers who have left the platform following changes to its content moderation rules. Although Musk previously suggested in an interview with the BBC that most advertisers had returned, the latest financial figures indicate otherwise.
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In a recent move, Twitter implemented restrictions on the number of tweets users can read, allowing unverified users to read 1,000 tweets per day and verified users to read 10,000 per day. This decision has puzzled advertising executives. Additionally, the company has been directing users toward its paid subscription service, Twitter Blue.
The appointment of Linda Yaccarino, former head of advertising at NBCUniversal, as CEO in June indicates that advertising sales remain a priority for the company. Yaccarino has expressed the company’s intention to focus on video, creator partnerships, and commerce.
The company is reportedly engaging in preliminary discussions with political and entertainment figures, payment services, and news and media publishers.