Musk: Twitter’s ad revenue is way down. Ya think?

Elon Musk is getting plenty of free business advice lately regarding his handling of Twitter, including from me. (To be fair, such advice is generally worth what you paid for it, including mine.) But this weekend, Musk responded to one follower by indicating that any big changes or improvements would not be possible for the time being, admitting that the company’s advertising revenue is roughly half of what it was when he purchased it and Twitter is still in a state of “negative cash flow.” Am I the only one who is completely unsurprised by this revelation? I was and still remain a staunch supporter of Elon Musk buying Twitter and wanting to restore free speech, but let’s face it. There have been some significant problems lately. (CNN)

Elon Musk disclosed on Twitter Saturday that, due to a 50% drop in advertising revenue and a “heavy debt load,” the platform still has a negative cash flow.

The billionaire owner tweeted Saturday, in response to business advice from a follower, “Need to reach positive cash flow before we have the luxury of anything else.”

The tweet is in stark contrast to his tone in April, when Musk told the BBC the platform is now “roughly breaking even” and that most of its advertisers have returned.

We’re still negative cash flow, due to ~50% drop in advertising revenue plus heavy debt load. Need to reach positive cash flow before we have the luxury of anything else.

— Elon Musk (@elonmusk) July 15, 2023

As I said, I was all in favor of Musk taking over the company and moving to end Big Tech censorship and restore free speech. And at least initially he made quite a few moves that seemed to suggest that was the direction that things would be taking. But Elon Musk turned out to be much more of a “hands-on” manager on a day-to-day basis and not everything has gone swimmingly, to put it mildly.

As far as the free speech issues go, Musk originally restored a lot of accounts that had previously been shut down for purely partisan reasons. He was also very transparent with the company’s former policies regarding shadow-banning and the like, and the way he freely shared The Twitter Files through the work of critical, independent journalists was a breath of fresh air. But after a while, we began seeing some accounts acting as if they were “suppressed” again, sometimes those of users who had been critical of Musk. I’ve begun to suspect that the only speech on Twitter that is 100% “free” is that of Musk himself.

And then there are the performance issues. A revamp of how the platform operates earlier this month effectively broke Tweetdeck, the application I use pretty much exclusively. Even when it is mostly working, the interface is much clunkier, more complicated, and less useful than before. That’s particularly true of the way DMs work now. And then he added his “stream limiting” policy. I’ve logged in several times only to find that all of my columns are dead (or “limited”) except the mentions column and I have already “reached my limit of tweets” for the day, despite only having seen three or four. I’m told I should “subscribe” to see more tweets. It usually clears up and starts mostly working later, but it’s extremely frustrating.

As far as subscribing goes, I’ve never had a problem with it in theory. I’ve written here in the past that I remain a capitalist and I understand that Musk needs to make the company profitable. I was seriously considering signing up and sending him eight bucks per month, not because of any additional features, but just as a show of support for his free speech efforts. But I hesitated, and now I’m not so sure about doing that anymore.

Is it really any wonder that views and ad revenue are down? I know that I use the site significantly less than I used to just because of the annoyance factor. And I’m someone who has racked up more than 230,000 tweets since joining in 2009. I’m not fully walking away yet and I have not signed up for a Threads account. I’ll take a wait-and-see approach for now, but I’ll just say my confidence level in the platform’s future and Musk’s management of it isn’t what it once was.