Declining revenues, Tesla’s woes and ‘resignation’: Musk’s wild Twitter reign so far | Elon Musk

WOn October 26, Elon Musk walked into Twitter’s offices with a sink in hand, the day before he bought the platform for $44bn (£38bn), the first sign that his ownership tale would be anything but traditional. “Let that sink in!” tweeted. For those who follow everyone from thousands of Twitter employees to advertisers and critical journalists, it certainly is now.

Since then, Musk’s reign has been unpredictable and controversial, with the Tesla CEO losing his title as the world’s richest man in the process. Here are some highlights from the past 10 weeks:

Laying off half the workforce

As Musk took over Twitter, he fired top executives, including: CEO, Parag Agrawal; Ned Segal, Chief Financial Officer; and Vijaya Gadde, head of legal policy, trust and security. Days later, he laid off 50% of the company’s 7,500-strong workforce, including the communications team, the anti-disinformation curation unit and disaster relief. human rights team.

More layoffs followed a strange episode in which Musk set a mid-November deadline for employees to commit to working “high-intensity long hours” and being “extremely strict” or giving them three months’ paid leave. This led to the departure of another 1,200 workers, according to one estimate. Musk says Twitter now has about 2,000 employees. Around the same time, Twitter reportedly let go of 4,000 contractors in areas including content moderation and engineering.

Responding to predictions of Twitter’s demise at the end of November, Musk tweeted: “Shouldn’t Twitter be dead now or something…?” However, the platform, which faced warnings of technical issues after letting go of so many expert staff, suffered an outage on December 28 that affected some users.

Musk said the layoffs were necessary because Twitter was losing $4 million a day. That’s a daunting figure for the business, which will have to pay more than $1 billion of the nearly $13 billion in debt it currently has on its balance sheet as part of the takeover financing. Musk said in December that Twitter was facing a “negative cash flow situation of $3 billion per year” but claimed the company would “approximate” break even after cost-cutting efforts.

Twitter has refused to restart its premium service, Blue. Photo: NurPhoto/Rex/Shutterstock

Alienated advertisers and subscription failures

Musk acknowledged that Twitter had experienced a “huge drop in revenue” since the takeover, which he blamed on campaign groups lobbying advertisers on security and content regulations under Musk’s leadership. Car maker Audi, pharmaceutical firm Pfizer and General Motors were among the brands that stopped spending on the platform immediately after the takeover. That’s a big deal for a company that will generate 90% of its $5 billion-plus revenue in 2021 from advertising.

The ad freeze deepened after the botched relaunch of Twitter’s premium service Blue, which saw many impersonators jump at the chance to launch “fake” verified company accounts for as little as $8 a month. Among the companies affected were pharmaceutical firm Eli Lilly & Co and Musk’s own Tesla, which caused the service to be temporarily suspended.

Work is being done to eliminate the damage. Twitter is working with the World Federation of Advertisers, which says its membership accounts for 90% of global ad spending, to address advertiser concerns, and Blue was relaunched before the fake account issue resurfaced.

The new service offers verified status with a blue tick or checkmark on iPhone for $8 a month or $11 a month. Musk believes mass verification is the best way to defeat the spam accounts he uses most on Twitter. Other benefits promised by the subscription service include an edit button, a 50% reduction in the number of ads in the user’s feed, and the ability to post longer tweets.

Donald Trump's Twitter account
Among others, Musk reinstated Donald Trump’s Twitter account. Photo: Stanislav Kogiku/SOPA Images/Rex/Shutterstock

Recovery of banned accounts

Andrew Tate, a British-American former kickboxer who was banned by Musk for overtly misogynistic posts and was arrested in Romania on Friday on charges of human trafficking, rape and organizing an organized crime ring, has lifted the ban on Donald Trump’s accounts. – and Canadian psychologist Jordan Peterson, among others. The account of American rapper Ye – formerly Kanye West – was also reinstated, but suspended again after he tweeted a picture of a swastika mixed with the Star of David.

At the same time, Musk announced a new content policy called “freedom of speech, but not freedom of expression,” saying that “negative/hateful” tweets would be “deboosted” and no ads would appear next to them.

The restorations were another sign of the inconsistent behavior that would mark Musk’s reign, just weeks after he said no decision on restoration would be made until a newly announced “content moderation board” convened. He blamed the apparent pullback on unnamed “political/social activist groups,” accusing them of persuading advertisers to stay away.

Dismissal of journalists

In mid-December, Musk contradicted his stance on free speech by freezing the accounts of prominent tech journalists at CNN, the Washington Post, Mashable and the New York Times. He accused them of violating Twitter’s newly created guidelines, which prohibit users from posting “live location information” that “would reveal a person’s location, regardless of whether that information is publicly available.” The directive was created as an apparent justification for the suspension of the @ElonJet Twitter account, which had long annoyed Musk by displaying the location of his private jet through publicly available data.

Days later, the reporters were reinstated after Musk posted a poll on his Twitter account that gave a majority vote in favor of the suspension. But Musk’s targeting of journalists drew condemnation from the UN, EU and campaign groups.

Also in December, Musk released internal Twitter files to select journalists in a project called The Twitter Files. The documents showed the internal process behind decisions to suspend Donald Trump’s account in 2021 and the platform’s response to the Hunter Biden laptop story. Another excerpt from the files raised questions about Twitter’s ties to the Pentagon.

Elon Musk during the Chancellor's visit to the Tesla Gigafactory Berlin-Brandenburg in Grunheide
Tesla shares are down 70% year to date to $122. Photo: Action Press/Shutterstock

Dragging the Tesla in

Musk’s status as Tesla CEO is key to his fortune and made him the richest person on the planet before losing the title to luxury magnate Bernard Arnault in December. The performance of the electric car maker, in which Musk owns a significant stake, has worsened as his interest in Twitter has increased. Musk’s involvement in the platform was first revealed in early April when it was revealed that he owned a large stake in the business, followed by a deal to buy the company a few weeks later, and he initially walked away from it before returning – prompting legal action. complete two months in advance.

In 2022, Tesla shares fell 70% to $123. Some of this is Tesla-specific, such as slowing demand and fears of Covid-19 shutdowns at Chinese factories, but Musk’s resale of Tesla stock to fund his Twitter purchase — despite saying in April he no longer plans to — plus a strong focus on its social media platform have also rattled investors. confused.

“Musk has lost credibility with the broader investment community through broken promises (repeatedly selling shares…), the Twitter fiasco, unleashing a political firestorm on Twitter, and tarnishing the brand for Musk and Tesla. per share,” said Dan Ives, managing director at financial services firm Wedbush Securities.

A majority of Twitter users voted for Musk to step down as CEO
A majority of Twitter users voted for Musk to step down as CEO. Photo: Andre M Chang/ZUMA Press Wire/REX/Shutterstock

“Resign” as a boss

Musk said he will step down as CEO of Twitter on December 20: “As soon as I find someone stupid enough to take the job!” His announcement followed a Twitter poll in which users overwhelmingly voted for his resignation. Bail also said after court testimony in November that he expected to “reduce my time on Twitter” after the “initial burst of activity.” Whoever takes the job will manage a globally influential social media platform with more than 250 million daily users. But with a very demanding and impulsive owner.

“One of the first things I said after Apple shut down was, ‘we’re going to make a lot of mistakes, but then we’re going to try to fix them quickly,’ and we did,” Musk said. The All-In Podcast aired just days after he announced his resignation. But the Tesla CEO’s biggest mistake — with little chance of a full recovery — may have been buying Twitter in the first place.

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