Twitter’s new owner Elon Musk told staff in an all-hands meeting Thursday that the company’s financial problems are so serious that “bankruptcy is not out of the question” if it doesn’t start generating significantly more revenue, as the billionaire privately voices a bleak outlook for Twitter’s future.
According to those involved with the meeting, Musk cautioned employees that Twitter did not have enough funds to continue. Musk said the social media company has a negative cash flow of many billion dollars without indicating whether this was an annual figure.
Musk has also pressed to generate additional money by overhauling Twitter Blue, a subscription service. Musk stated in one of his emails to employees on Thursday that subscriptions would eventually account for around half of the company’s revenue.
“Without significant subscription revenue, there is a good chance Twitter will not survive the upcoming economic downturn,” he wrote.
Musk, who bought Twitter for $44 billion on Oct. 27, said the firm was losing more than $4 million per day, mainly owing to advertisers fleeing after he took over.
Musk has saddled Twitter with $13 billion in debt, with interest payments reaching over $1.2 billion over the next year. The payouts exceed Twitter’s most recent cash flow, which was $1.1 billion at the end of June.
According to Bloomberg News, Musk indicated in his first email to Twitter staff on Thursday that remote work would no longer be permitted and that employees would be expected to work at least 40 hours per week.
Musk made plans to fire half of his employees last week, which is not the best approach to establishing a positive working relationship between the CEO and the workforce. But that is the approach Musk adopts as he attempts to make significant changes to the social site that are controversial with some of the staff members after his massive layoffs of Twitter’s workforce.
“Elon has shown that he cares only about recouping the losses he’s incurring as a result of failing to get out of his binding obligation to buy Twitter,” one disgruntled employee wrote in an email to coworkers, according to the NYT.
“This will put huge amount of personal, professional and legal risk onto engineers: I anticipate that all of you will be pressured by management into pushing out changes that will likely lead to major incidents.”
