In a recent appearance at the Morgan Stanley investor conference, Twitter CEO Elon Musk revealed that the company may become cash flow positive in the next quarter. This is due to the aggressive cost-cutting measures and new revenue streams that Musk has implemented since taking over the social media platform.
Elon Musk reveals Twitter’s path to becoming cash flow positive
Musk discussed the importance of cost management and revealed that he was surprised at how poorly Twitter‘s old bosses had managed to monetize the platform. However, he and his team have now reduced the company’s non-debt expenditures from a projected $4.5 billion in 2023 to $1.5 billion, primarily by cutting down the cloud service bill by 40%, closing down a data center, and reducing the employee headcount.
Musk also spoke about Twitter’s biggest revenue source, advertising, which has seen a massive decline lately. He attributed this decline to the cyclical nature of ad spending. However, Musk is confident that Twitter’s revenue per hour can increase from the current 5 to 6 cents to 15 to 20 cents with users spending 130 million hours per day.
Despite recent Twitter outages, Musk assured investors that the platform’s engineers are working on a “clean up” in Twitter’s software code. With these measures in place, Musk is optimistic that Twitter will be cash flow positive soon.