(The Hill) — The financial woes for Twitter appear to be continuing as owner Elon Musk announced the platform is experiencing a nearly 50% drop in advertising revenue as it struggles with heavy debt load.
“We’re still negative cash flow, due to ~50% drop in advertising revenue plus heavy debt load. Need to reach positive cash flow before we have the luxury of anything else,” Twitter owner Musk wrote in a tweet Saturday.
Musk, who also serves as CEO of Tesla and SpaceX, acquired Twitter last fall in a $44 billion deal. He served as the social media platform’s CEO before stepping down last month and serving as executive chair and chief technology officer.
Since taking over the company in October, the billionaire made a series of controversial choices, including mass layoffs, firing top executives and launching the Twitter Blue program, which requires users to pay a monthly subscription for the verification check. Musk also pulled back on various content moderation measures, reinstating previously suspended accounts like that of former President Trump, while limiting how many tweets users can read in a day.
He tried to reassure advertisers concerned about these choices, telling the BBC in April the platform is “roughly breaking even,” after his tumultuous takeover. Musk told BBC most of the advertisers had returned following their exodus, BBC reported.
In May, Musk hired new CEO, Linda Yaccarino, a former head of advertising for NBCUniversal, who he said would focus on mostly business operations including product design and new technology.
The news comes days after Matthew Price, CEO of Cloudflare, a web security firm, announced Twitter’s traffic has plunged since Musk purchased the social media platform.
Earlier this month, Meta launched a new text-based platform that directly rivals Twitter. The platform reached 100 million downloads within the first week of its release.
The Associated Press contributed to this report.