Twitter has lost almost half its advertising revenue since it was bought by Elon Musk last October, its owner has revealed. He added that there had not been an increase in revenue as was expected in June.
When Elon took over in 2022, he sacked close to half of Twitter’s 7,500 staff in an effort to cut costs. Mr Musk mentioned that their cash flow remains negative and are currently struggling with a heavy debt load.
The rival app launched in July, Threads, now has over 150 million users. Its in-built connection to Instagram gives it access to a potential 2 billion users. Furthermore, users with many followers on Instagram and joined threads cannot delete the application due to the possibility of losing their own Instagram app. This ensures sustenance in the application even after.
“Need to reach positive cash flow before we have the luxury of anything else,” Elon tweeted.
He laid off thousands of employees and cut cloud service bills with the intention of increasing the revenue from $5.1 billion in 2021 to $3 billion in 2023. They however did not meet the targeted revenue goal in June records due to the loss of advertisements.
After changes to its content moderation rules, many companies have stopped advertising on Twitter. Consequentially, even the laying off of employees and cutting cloud service bills could not increase the revenue to the expected level.
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Earlier this month, Twitter introduced a limit to the number of tweets one can read. In the most recent review, unverified users can now read 1,000 tweets, new unverified accounts can read 500 tweets and verified users can read 10,000 tweets per day. This was done so as to push people to get Twitter Blue and pay a subscription fee.
After the launch of its rival app, Threads, many users rushed to it due to its unlimited access to threads. In addition to this, many users on the Threads app could add as many followers as they would wish due to the provision of following people you follow on Instagram.
Read Also: Threads: Elon Musk Threatens to Sue Meta For Newly Launched App
