Elon Musk, the new owner of Twitter, announced a massive drop in revenue, blaming activist groups that put pressure on advertisers, claiming that the decline in revenue has continued since his takeover. Credit experts believe it underscores the difficult state of the social media company’s finances after burdening it with $13 billion in debt.
Twitter’s revenue fell in its most recent quarterly report in July, berating Musk’s $44 billion takeover proposal and a dwindling digital advertising market. Inflationary pressures and recession fears have put pressure on some advertisers to reduce their advertising budgets. In the second quarter, ad sales accounted for more than 90% of Twitter’s revenue.
To salvage the situation, Musk cut costs by laying off about half of the company’s workforce, tried to save up to $1 billion in annual infrastructure costs, including servers and cloud services, and instituting a $8 monthly fee for Twitter verification and other perks.
The sources for this piece include an article in Reuters.