That means, Elon has to pull at almost all stops to make Twitter profitable and that means a lot of pain and change at Twitter. Every change need not make it front page of HN. The tactics may be new, but the strategy is as old as it gets.
All the usual business calculus kind of goes out the window when you have a single owner that only needs to stay afloat and may not care about maximizing profit or value.
That said, it is likely that he want to make a profit, at least on an annual basis, if not overall ROI
Can he actually off the debt without endangering his other businesses? Do you really think 1 billion yearly loss is something he can be comfortable with? His worth is in propery and businesses mostly, he does not have it sitting in a bank. That is the thing. He needs to maximize profits in order to ... not be in huge loss.
Like, yeah, this is political project of his and it is both celebrated (by political side that gains by him owning it) and yelled about (by political side that is about to be pushed away from there) for political reasons. But, that does not mean he can have it as complete looser - if nothing for ego reasons.
And his initial moves are moves of someone desperate to save some cash and panicking.
Yeah, I think he could realistically run twitter as a non-profit if we wanted, and eat the cost until he died. He owns half of SpaceX worth ~125 billion, and could sell $1 billion per year indefinitely without losing control.
The reality is that he obviously doesn't want to have twitter as money sink (reference intended).
He is no stranger to losing vast amounts of money in the short term, so I personally don't think panic is driving his behavior. Rather, I think this is simply what a hostile Elon takeover looks like and how he operates. That is to say, like a bull in a china shop with full media coverage.
There will be flailing, bold claims, pivots, mystery, and intrigue. Underneath that, the real work will be a radical restructuring and gutting of the existing corporate culture.
Twitter's share price was only so high because some idiot promised to pay 44 billion dollars for it.
TSLA is down ~45%. Elon sold 15B of Tesla stock to finance the deal and presumably 11B of other assets.
* SNAP is -87% from 2021 peak
* META is -75% from 2021 peak
* PINS is -70% from 2021 peak
* TWTR was acquired for -30% ($44B) from 2021 peak, -70% to -80% gives us $12-18B valuation sans Musk.
Twitter was unprofitable, but people generally accept that for companies with consistent user growth. The valuation without Musk would likely have been around $25B to $35B. "$10B" is the fundamental DCF valuation, which isn't what anything is traded at these days, even after the tech crash.
July 1st, 2021 to April 1st, 2022
* TWTR: -42%
* META: -37%
* SNAP: -44%
* PINS: -69%
So is Twitter.
https://www.reuters.com/technology/exclusive-where-did-tweet...
I say this as someone whose been a big tech co employee my entire life and who has seen how easily 10 or 20 million gets spent. I have also seen how easily a million gets thrown out here or there for vendors to do some data analysis work, or even worse, create shiny powerpoint slides to present to higher ups.
Remove a layer of management, stop all the outsourced make-work, and you may end up halfway there to saving 200 million.
I guess I should have stated that Twitter could have been profitable awhile back, and it was likely a choice they made to not be. Not sure why they made that choice, and it seems like everyone who does know why no longer works there.
My overall point was that large corporations have a lot of waste in them, entire teams dedicated to making shiny dashboards for execs who only ever look at them once or twice a year, or, something I saw at Microsoft, hiring vendors to write software, and also hiring another vending firm to manage the first vending firm. (Because MS, despite being filled with program managers and software developers, wasn't set up at the time to do short term projects so the easiest solution to that organizational problem was to flush a few million extra down the tubes...)
Twitter is a 75% squeezed lemon, has some life in it but Musk is set on wasting it thinking it is a staple like telephone / email is.