Months after the acquisition of Twitter, billionaire Elon Musk has acknowledged the social media platform’s loss in ad revenue and negative cash flow.
Musk noted that Twitter’s considerable debt and a significant 50% decline in advertising revenue continue to impact its cash flow.
His admission came in response to a Twitter user named Sophie, who suggested that Musk gather a consortium that reflects his vision for the website.
“… and have them buy the debt then do a tender/exchange offer for convertible notes w more favorable terms,” she added.
Responding to her tweet, the tycoon said: “We’re still negative cash flow, due to ~50% drop in advertising revenue plus heavy debt load,” he wrote.
Musk added that Twitter needs to achieve positive cash flow as a priority before considering other initiatives.
In response to user complaints, the Twitter owner also announced that verified Twitter accounts would have their daily tweet limit increased by 50%.
After the acquisition of the bird app by Musk, several major advertisers temporarily halted their spending on the platform due to concerns about potential changes initiated by the billionaire.
The Space X chief, however, revealed earlier this year that many of these advertisers had returned, expressing confidence in the approaching achievement of positive cash flow.
Estimates from market research firm Sensor Tower showed that advertiser spending on Twitter lessened by 89% to $7.6 million over a two-month period earlier this year.
Before Musk took over, the top 10 advertisers had spent $71 million on ads from September to October 2022.