It might, perhaps, almost be that a google trends graph isn't a reliable measure of business sustainability.
Twitter was only profitable for one year while it was public (2018). It's not like Elon could make that much worse. For what it's worth, he claims (edit: claimed before the advertisers left) it's break-even now.
As for competing services, Facebook has their work cut out for them. Active Daily User count on Threads has gone down 70% from it's bombastic launch. Average user engagement time has also gone down to 4 minutes from 19.
https://www.wsj.com/articles/threads-user-engagement-continu...
https://www.forbes.com/sites/willskipworth/2023/07/21/thread...
Musk is swimming upstream, having notched the top-tick LBO of a decade-long ZIRP run.
With Twitter's original finances, in a strong economy, the debt would have been difficult. As currently configured, with ad revenue down 50% [1], it's obviously unsustainable, a reality reflected in its bonds' prices.
> he claims it's break-even now
Musk expected, last year, Twitter to break even this year [2]. He claimed break-even in April, but conceded profitability was still away [3], implying an unlevered definition of breaking even, i.e. before financing costs.
[1] https://www.reuters.com/technology/elon-musk-says-twitters-c...
[2] https://www.reuters.com/technology/elon-musk-expects-twitter...
[3] https://www.marketwatch.com/story/elon-musk-twitter-is-opera...
It is not, and will not be the point for Elon - he's clearly stated he does not care about money. There are goals beyond what the petty populace panders or bitches about. So again, your argument - while well formulated, is insignificant if the short-term losses support long-term heading changes.
What's your take on Amazon?
Which are? And I'm asking about Twitter specifically not Tesla or SpaceX.
- Maximize user-minute happiness
- Make Twitter a source of timely truth
Amazon isn't levered to the hilt. It can choose its own time frames.
Leverage enforces an external horizon. It's unlikely Musk loses control of Twitter in bankruptcy--nobody wants it. But even if he "does not care about money," which is obviously untrue, he structures for himself and responds to monetary incentives, his lenders (and advertisers and employees and minority shareholders) do, and that's operational chaos for potentially months on end that adds zero value to Twitter or his brand.
That's like saying that because a company is profitable there is no room for improvement. There is a big difference between making $1 a year and making $1 billion a year, and same that there is a big difference between losing $1 a year and losing $1 billion a year.
It can absolutely get worse than running roughly break-even. If you have $4b in revenue and $4b in operating costs, and your lose half your revenue, you now have a hole that gets $2b deeper every year.
On top of that, the buyout added a $13b loan which has an annual minimum cost of $1b.
So he needs to increase profitability by a quarter of their previous annual revenue just to get back to where Twitter was pre-buyout.
As if this scale were merely binary rather than a continuum.
To be fair he could. Even ignoring everything else the interest alone on the debt alone he offloaded to Twitter during the acquisition is enough to finance the payroll of at least 1000-2000 additional employees (assuming total 600-300k cost per person and only 5% interest..). Which is why he had to fire so many people.
To say that "Elon has no doubt pissed off [...] some advertisers" is such a hilarious understatement.
Also: https://twitter.com/elonmusk/status/1680082007873953794
I'm not disagreeing with your point just nitpicking word choice; the best kind of annoying comment!
Maybe he just wants to build WeChat ultimately to be sold to the US government, in the same vain as with his other ventures where he runs on government subsidies and/or full-on privatization mandates.
Again, extrapolate mid/long-term with “new” Republicans (don’t care about small gov at this point) potentially winning next election(s) and him providing an “AI” enabled personal interface for every US citizen… what could go wrong?
It’s a natural sell / setup for “we must win against evil empire of China, be as efficient, yaddayadda”.
The only question left at this point is how soon.
Pre-Elon, you have financial statements showing the strength of the company. Profitable before Covid before they hired a massive number of people (like a lot of companies during covid) and then dropped below profitability. It's very possible that a smaller layoff and a focus on fundamentals could have brought them back to profitability.
Elon has admitted that they've lost around 50% in ad revenue since the takeover and that they're not cash-flow positive. Reports are saying 59%-70%. I'm inclined to believe that Elon is under reporting to the public (based on his history of exaggerating/under-reporting/lying about this kind of stuff). Either way, it's clear Twitter is in a much weaker position now than pre-takeover.
https://trends.google.com/trends/explore?geo=US&q=twitter&hl...
It's having a downturn, but in the big picture, it's business as usual.
https://trends.google.com/trends/explore?date=today%205-y&ge...
Edit: I am perfectly aware that Google Trends is not a perfect metric. My point is more broadly that claims of "dying" are anecdotal and exaggerated. Advertisers leaving a service also doesn't count as "dying."