Elon Musk claimed that Twitter is like a crashed plane with its engines on fire during a discussion regarding the platform’s financial issues

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Elon Musk described Twitter as “a plane heading towards the ground”, in a Twitter Space on Tuesday. He explained that Twitter was a negative cash flow forecast of $3 billion next years and had to cut costs.

Elon Musk likened Twitter to a plane accident, explaining why he decided to cut costs by implementing mass layoffs within the first weeks of buying it.

Musk tweeted late Tuesday night, “This company is almost like a plane headed toward the ground at high speed with the engines on fire and the controls not working.”

First reported by the Financial Times on the comments. Insider has listened as Musk appeared on Twitter Space. It was called “Scale and Complexity and number of Engineers” and was hosted by George Hotz.

Musk admitted that his actions might sometimes seem spurious, odd, or whatever during the chat.

He said, “It’s because there is an emergency fire drill on us hands.” “Not because I’m naturally unpredictable.”

Twitter CEO, who is currently looking for his replacement, stated that the company had a negative cash flow forecast of $3 billion in 2013 before he took cost-cutting steps.

Musk stated that the company is expected to generate around $3 billion in revenue by 2023 and have net cash outflows of approximately $6.5 billion. The company reported a revenue of $5 billion in its 2021 annual report. Total costs were approximately $5.6 billion and a net loss was $221,000.

Musk stated that Twitter’s financial position is also affected by $12.5 billion in debt it took on as part its purchase of Musk. Musk stated that the debt’s annual servicing costs are approximately $1.5 billion. Musk said that interest rates “going crazy” have led to an increase in these costs.

Musk believes that the company will be able to break even next year because of layoffs and increased subscriber revenue via Twitter Blue. Musk stated that the company would have been “dead” without his changes.

According to Kali Hays of Insider, the number of employees has dropped from 7,000 down to around 2,300 since Musk’s takeover. The New York Times reported that Twitter stopped paying rent in its offices and refused to pay $200,000 for private jet flights.

Musk spoke at the Twitter Space about his meetings and explained that advertisers asked him “hard questions” about his return on investment due to the declining macroeconomic environment.

He said, “If you don’t have a clear answer to your question, advertisers won’t advertise because they are being rational.”

In a poll that was posted just hours after Musk was photographed with the CEO at Qatar Investment Authority (which has a $375million stake in the company), Twitter users voted in favor of Musk as the next CEO.

Twitter didn’t immediately respond to Insider’s request for comment.

Business Insider has the original article.
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By: psyme@insider.com (Pete Syme)
Title: Elon Musk said Twitter is like a crashing plane with its ‘engines on fire’ in a discussion of the platform’s financial issues
Sourced From: www.businessinsider.com/elon-musk-twitter-plane-crash-3-billion-negative-cash-flow-2022-12
Published Date: Wed, 21 Dec 2022 15:33:09 +0000