They've already cut about 80% of their workforce since Elon took over, I'm not sure how much more attrition they can take. Sure the site still mostly works in the technical sense, but the way it works now has led to a significant decline in revenue and active users.
There’s how much the company can take, and how much Elon thinks the company can take. He subscribes to the ubermensch view, where him and maybe two other superior specimens of manhood could single handedly run the entire company.
I thought the company would collapse after firing 80% of staff, and for a long time I kept arguing that Twitter was still in the "Wile E Coyote ran off the edge of the cliff but didn't fall yet" phase where they were running on pure momentum. I must admit, as time goes by, it's harder and harder to argue that. I just can't believe that 80% of the company was really just not needed. Every company I've ever worked at was lean to the point where they almost couldn't get anything done due to lack of people. I can't imagine a company that could lose 80% of their people and keep on trucking.
The thing about Infra - is that if all you want is 99% uptime - that's, with reasonable architectural decisions - relatively straightforward. You can run with a skeleton crew (particularly if you make really smart Infra Decisions like Midjourney, Whatsapp, others have done an outsource 95%+ of your infra to a third party (Discord, Platform Messaging APIs).
As time goes on though, and you go through incident review after incident review, and sharpen things up - and 99% becomes 99.9% you start to get diminishing returns on more Infra Employees - at some point they don't add much reliability value (but boy do they make pager rotation schedules pretty nice).
My sense (from both interviewing and working with them) is that the vast majority of people fired/laid off from Twitter weren't (for the most part - definitely lots of exceptions) core engineers or core infra-people -they were people on the periphery associated with making Twitter a friendly place for advertisers, and just maintaining a healthy work-life balance for the Infra people - a job where you could work your 30-32/hours week without it becoming all encompassing.
When they were fired, Twitter became a very unfriendly place, and the advertisers ran away, and the revenue crashed.
Musk took a bunch of outside money during the buyout so they're still reporting results to e.g. Fidelity and other debtholders. Hence why we broadly know that investors have lost >70% of their money: https://x.com/danprimack/status/1774456271871033823
They just announced an anti-trust lawsuit regarding what they say is a coordinated effort to remove advertisers from the site. Not advocating one way or the other as to the merits of the claim but an interesting development regarding the revenue drop you mentioned.
Companies have to be sensitive to the overton window of their customers. You make a mistake - it can be expensive. Let's ignore X/Twitter for a second - look at what happened to one of ABInBev's brands, Bud Light. They stepped outside that window and got smacked down pretty quickly.
I still don't understand why Musk believes he can dictate to his customers who they should do business with. I can kind of understand regulating what vendors do when interacting, particularly with (for the most part) completely powerless customers caught up in monopolies. But I'm looking forward to digging into the theory of law which suggests that vendors can regulate who/what type of business their customers do.
I've heard of Monosopny's - but it just doesn't feel like there is a "single buyer" in this scenario - and, companies are really, really profit seeking - if there was an opportunity for them to make a lot of money by advertising on Twitter/X, and increasing their revenue, and therefore their stock - I challenge you go find me 1 CFO/VP Marketing in 100 who wouldn't jump at the chance. Their political views would be irrelevant.
The problem is - when all these trust and safety and advertising people were let go -their was nobody left to reassure those CFO/VP Marketing types that something horrible wouldn't happen to their brand on Twitter/X. So they just decided to play it safe until things shook out.
This lawsuit is ridiculous. If Twitter can sue companies for not advertising, can Tesla sue people for buying vehicles not made by Tesla? Can Google sue companies for advertising on Bing? Can Rivian sue Tesla buyers for not buying Rivians?
The whole notion that Twitter is owed a share of advertising spend (based on what?) is absurd.
Don't forget that 2022 was still a good time for tech with people recovering from COVID lockdowns. It's not really much of a surprise that they're back to pre-COVID income.
Aside from that, there's the lawsuit the sibling mentioned, plus the coordinated campaigns from groups like Media Matters and others attempting to scare advertisers away.
Those numbers don't mean anything. Revenue does not equal profit.
Tesla makes double what GM makes with a 1/3 of the revenue. Twitter was always a money loser. If they made $661M in revenue, but lost 700m, and now they make $114M a quarter with $80M in profits, i wouldn't call that a dramatic collapse but rather a dramatic revival.
Quote profit not revenue when it comes to Elon Companies.
> now they make $114M a quarter with $80M in profits
> Quote profit not revenue when it comes to Elon Companies.
Notably, the company does not release audited financials anymore. If the company were able to go from breakeven to netting 80% margins, great. But nobody should believe such a turnaround without evidence.
Separately, if the company were netting $320mm annually (using your hypothetical), AND we assign the P/E of best-in-class Meta (which is growing, not shrinking), the company would be worth $8B[1]. Under these generous assumptions, Musk has presided over a $36B (82%) destruction of value in under 2 years.
1 - That's not accounting for the outstanding debt used to finance the deal. Including that makes the value of the enterprise negative.
Not able to comment on the technical side, but for sure a lot people who got sacked were on moderation. Some countries like mine eventually lost all moderators specifically working for that country. And it does show in the amount of spam an unchecked racism etc, which is a big reason why many advertisers left.
From a moderation point of view, Twitter arguably did collapse. The technical side is not all there is to it when running social media.
Depends on your standards I guess. You could cut it down to one person and have a website running. As it stands if you look at most people's profiles when logged out you see tweets starting a couple years ago other than the pinned tweet. I haven't used it much since a bit before Elon took over but generally as I understand it's more buggy and spammy than before. If that's good enough, I guess you could say it's still trucking.
Funny thing is that I took the opposite side of that bet. I figured Elon would slash things that people thought were important but actually weren't, and make it more efficient. It's mostly played out, except that the site is still rickety. But maybe from a business perspective that's not important, which is a shame for us.
I think Twitter is down 60% in advertisers and 30% in users? Elon personality is part of it, but losing so many people handling community, clients, institutions… I am sure the company has lost most of its institutional knowledge.
> I can't imagine a company that could lose 80% of their people and keep on trucking.
Musk didn't buy Twitter to make money or learn how to run a successful business. "Keep on trucking" isn't what Twitter is supposed to be doing right now. 20% workforce is more than enough to run the operation in maintenance mode, which is exactly what's being asked for.
How many dev-ops roles would it take to just keep the lights on at your org? A dozen? Three? You certainly wouldn't have a need for decision-makers or heavy lifters.
By "maintenance mode" you mean shipping more features per year than the pre-Elon Twitter? Remember, the pre-Elon Twitter was completely stagnant and seemingly unable to ship even the most desired features.
Musk has openly said many times he wants X to be an "everything app" and sees huge growth in its future. What makes you think he ever intended to put it in "maintenance mode"?
a) slowly lose to competitors as you can't keep up with increased demands in the space.
b) take on more and more existential risks
For a lot of companies, that is exactly what they want to do. Its called the exploit phase, I forgot what business lingo this came from. Do a practical feature freeze, cut costs to the max, and squeeze all the value out the product for as long as it lives. Informally known as enshittification. Its all about cost-cutting rather than market capture.
You can last a while though, especially because there aren't many changes so there's also less operational risk.
People always find a way to justify their existence. In sufficiently large companies you can find people whose job is to satisfy policies invented by other people in other departments. In one sense, they were all "needed" because of the domino effects of some policy created long ago.
But if you get rid of all of it at the same time, it might be tough to see the difference from the outside.
80% was needed to grow the business. If Twitter chooses not to grow them it doesn't need those people. It only needs enough to keep the lights on.
If Twitter ever gets a competitor with some traction it'll be dead in months because it won't be able to react. It seems like new social networks aren't a thing any more though so it's probably quite safe.
Let's assume we can trust these numbers. The user count is not material for a site that has already scaled and monetized, so focus on the actual money changing hands.
That is obviously in decline but does alone not capture how much worse off the company is today than before the acquisition. In 2022, the company did $4.4B in revenue and had negligible debt. In 2023, the company possibly had debt service payments in the range of $1.2B for the year. If you back out the mandatory debt service, 2023 looks more like $2B in topline.
Put another way: Twitter 2022 was significantly more capital-efficient than Twitter 2024.
Similarly, one can run a simple model of the value of the company now. Once you include the $13B in outstanding debt, you will end up with a negative number.
The linked article doesn’t seem to say anything about growth in revenue numbers - but it does say overall revenue has dropped 50% since Musks takeover. The quarterly chart doesn’t look great either.
Further, the brand has been tainted and Threads was allowed to pop up. Now threads is around 1/4 to 1/3 the size of Twitter MAU. It may not have replaced Twitter, but the door has been opened and that seems like an unforced error.
This election season looks poised to further drive long term disengagement as the platform is going to be very toxic and very unmoderated.
Otoh, profit might actually be up - if revenues are down 50% but costs down 80%, it may make more money. I suspect, like other private equity investments, this will not work for too long. With how much Musk has put his personal brand onto the site, it may also be difficult to unload the pieces at a profit as per the normal PE playbook.
> Threads was allowed to pop up. Now threads is around 1/4 to 1/3 the size of Twitter MAU
Main thing I consume on X nowadays is space journalism. Plenty of big name space journalists seriously posting on X (e.g. Jeff Foust, Eric Berger). I had a look at Threads, I can't find any of that content, mostly just people posting silly memes and mind-numbingly misinformed takes on the topic, at best people just reposting stuff that you'll already find better coverage of on X.
> This election season looks poised to further drive long term disengagement as the platform is going to be very toxic and very unmoderated.
I don't find much "toxic" on X. If you only read stuff posted by people you follow, and are selective in who you follow, you can have a pretty curated experience.
Don't forget the peak happened during COVID- where it is at now isn't really much different than where it was before, if the numbers are accurate anyway.
The brand was never not tainted. Twitter has long been known as one of the cesspools of the Internet, actively contributing to the degradation of the social fabric. It would be a great blessing if Elon did actually kill it the way his detractors predicted. Twitter delenda est.
Look at the revenues per quarter. It was growing in 2023, but declined in the first quarter of 2024, but I wouldn't say you can make conclusions for 2024 from one quarter.
No one is comparing year over year, there's been barely a year since the acquisition. I said the "arrow" over the latest few quarters was generally UP, in response to a mistaken argument that Twitter/X has collapsed. I am not trying to say Elon is great or something like that, I am making an observation of what the charts say, that's all. I don't know if the charts are 100% accurate, but I have no reason to doubt either... Why anything that may be positive about X is so controversial, even something as uncontroversial as the direction of an arrow on a damn graph? People seem to lose all rationality over this guy, what the hell is going on?! Do you actually have figures showing completely different results?? IF no, why all of a sudden people are so completely skeptical of it?! Sounds like discussions about climate change: someone shows a chart with temperatures way up, all of a sudden everyone is an expert and points out it was higher 60 million years ago or whatever, or the data cannot be fully trusted because they learned in high school that these are just estimates or other crap on the same vein. It's embarrassing for the human race.
The point has nothing to do with Elon. It's just the correct way to analyze revenue graphs due to seasonality. Whether or not X is "collapsing" isn't obvious from the graphs either, and I made no such claim. We'd need to know other things that aren't public, and it's probably too early to tell anyway. But it's incorrect to say that revenue is growing. It's down quarterly YoY, which is the only real meaningful way to look at it.
Further, everything after Musk bought it is just a guess. Without public audited numbers, who knows what is going on. If I had to bet, I would guess the numbers are even lower than estimated - if things were hunky dory, I doubt they would be suing their customers (advertisers).
If you're suing your customers? With frivolous lawsuits? You are admitting that your business is in collapse.
There's no mystery here. The company cut Trust & Safety so that people could post whatever they want under the guise of "free speech." This means more objectionable (to advertisers) content on the site. Advertisers do not want to run ads next to objectionable content.
Worse, Twitter was never big enough to really matter to big ad spenders. So it's small, doesn't have the ability to move the needle for any big advertiser, and now CMOs/ad agencies have to worry about their ads being run next to 4chan-quality posts? Easy decision to stop spending there. There's really no conspiracy involved here.
At base, this is a simple conflict of ideas. Twitter management wants to create a space where people can post ideas that may be broadly seen as objectionable, even if they are legal. Big advertisers are well-known for restricting their ads to more sanitized spaces (this practice predates the Internet). The goals of Twitter management are directly in conflict with the goals of big advertisers. This was the obvious way for this situation to unfold.
“ If you're a Twitter diehard who's not willing to swap to X, it might be finally time to ditch X for Mastadon or Threads. On your way out, don't forget to delete your X account.”
journalists are so biased against X
You're getting downvoted because you're just regurgitating the Elon Musk fanboy "journalists hate X because they're threatened by it!" and "journalists are biased and not trustworthy!" party line nonsense like a complete weirdo.
To me "revenue and MAUs have declined significantly" sounds like a reason they would want to reduce employee numbers, rather than a reason they wouldn't.
At least in a conventional business that uses revenue to pay wages.
Terminating employees without cause (i.e. due to employee’s poor performance) entitles the employer to unemployment benefits, causing the state to increase the business’s unemployment insurance premiums.
If an employee quits or is terminated due to not coming into work, then they are not eligible for unemployment benefits, and hence the business’s unemployment insurance premiums are unaffected.
They've cut out things like viewing who liked a tweet etc (for cost savings I suspect) so the site is probably dirt cheap. Can't imagine ads don't pay for the cost of running servers at this point, and a headcount reduction might bring it to profitability.
The ads may pay for the servers and reduced headcount[1], but there is no way that they pay for servicing the $10B of high-interest debt that the company was saddled with.
[1] Though with the NYT reporting that the American ad revenues was down 80% to $114M/quarter since the acquisition it might not be so obvious.
> American ad revenues was down 80% to $114M/quarter since the acquisition
Debt service was estimated at ~$100m/mo, with the likelihood that rates on some of the debt could increase substantially since the financing was initially booked in mid 2022.
If these numbers are directionally accurate (and they do not report, so we don't know for sure), this thing is probably closer to losing a billion $ annually than to breakeven.
But market rates are well known and well published. CCC class loans were 10% in April 2022 when these deals were likely. So 10% to 15% covers the possible range of loans if you know much about the market.
The higher end of 15% would be possible if the loans were finalized closer to May or June.
There is a big difference from Feb 2022 vs April 2022 though. But we know the rough timeline of Twitters acquisition as well as the rough timeline of when deals were signed. So I'm reasonably confident in an April 2022 deal.
Looks like when he took down the financing, rates would have been in the 12% range. Possible some/all of the debt has been rolled over since then, possibly at higher rates.
Yes, the debt weighs heavily around their neck. If it eventually ends up in bankruptcy, will Elon Musk lose control of his beloved x.com domain name for the second time?
I would imagine that it was set up so that it is rented from Musk (instead of owning* outright), but it's Musk so who knows.
* I know it's still not owned owned but there is still a legal difference between X Corp directly renting x.com (from Verisign) versus leasing x.com by a different owner (maybe Musk, maybe a holding corp) to X Corp.
That's not how a bankruptcy works. In a bankruptcy, the company is owned by the creditors and gets resolved by them. Usually a business will attempt to avoid bankruptcy by filing Chapter 11[1] or similar so they get to propose a plan for restructuring that will pay back the creditors over time, but their actions as debtor in posession are scrutinized by the US trustee to ensure they meet a fiduciary obligation to the debtors, and the debtors can file a court case to appeal both the chap 11 and can try to get the debtor kicked out and a trustee appointed if they aren't acting in their interests.
I will wager a box of donuts the like-hiding was due to some combination of politics and Musk’s embarrassment for being called out every time he liked some cringe porn-adjacent tweet.
The issue is the $13 Billion loans and estimated $1.3 Billion/year interest payments.
I'm sure Elon can wipe those out himself, but it's still a lot of money that isn't accounted for. Twitter cannot merely float at barely profitability. Twitter needs at least $1.3 Billion/year to counteract interest payments.
I actually don't think the removal of like views has anything to do with revenue.
I think they actually did this so users are free to like whatever they want without having to worry about getting vilified for liking something that is not supported by the majority. For example liking something political or anti whatever.
4Chan was run by like one guy using the change he found in the cushions of his couch.
Getting the pixels on people's screens is the easy part. Keeping the Nazis and bots at bay is the expensive part. You have to do the latter if you want to keep the advertisers on your site, which is why X switched to a more for-pay model and still loses money hand over fist. Being able to pay to have your voice amplified has been a real boon for the fascist users on X, they're having a great time.
I much prefer the Twitter of today. Since I'm a grown adult, I can handle some mean words being seen by my eyes, and just ignoring what I don't like. It's nice seeing a balance of both sides of an argument now, rather than only seeing the left biased information.
I was a big Reddit user back in 2015/16 and also spent a lot of time in the NPR comments. Watching the insanity around the 2016 election in real time was an interesting experience. The mass suppression on Reddit and NPR shutting their comment section down was enough to form my opinion on this whole thing.
That being said, I've enjoyed it since the takeover. It still seems very similar to what it used to be, but feels very much like I'm seeing it from both ends now. For every crazy right leaning comment there are plenty of crazy leftists that counter, and vice versa.
Is "left biased information" a euphemism for anything that doesn't include Nazi propaganda or hate speech? Because those are pretty much the things that were (loosely, not fully) banned prior to Elon's takeover.
"You and everyone like you should be rounded up and executed" is a just a mean message, but it's also dangerous. People will believe that stuff, and then try to do it. This isn't a theoretical danger, it has happened time and time again throughout history. These sorts of seductive messages that target out-groups and provide a sense of community have lead to real life horrors.
X has also gotten very bad about amplifying misinformation, especially on white supremacist topics. Just yesterday (maybe the day before?) that bullshit old paper that said sub-Saharan Africans had an average IQ of 55 made it to the top of the feed with no community notes. The comment section was full of great replacement theory blue check guys all agreeing with one another and making it sound like there was a consensus. People see stuff like this and actually believe it. Frankly I wouldn't be surprised if Elon himself re-Xed it at some point.
> They should know better and the best have already left or been culled.
We should care, even if it's just a little. Some of them may not be able to leave for various reasons: health, family, immigration status, who knows.
Maybe if more of us showed a bit more empathy towards each other online, the Internet wouldn't be such a sociopathic cesspool. These are real people you're talking about, not inanimate objects.
Interesting question. Should have joined the Rebel Alliance, or at least actively worked to sabotage the Death Star. A little mis-solder here, a little wire pull there, and ...
Of course, I agree with you at the individual level.
However, at the macro level, I'm more than happy to see jobs destroyed at insert sh1tty company for the good of both individuals, and the good of the nation/world. Short term pain, long term gain. And don't tell me the workers X/twitter can't get re-hired or land on their feet elsewhere ... so actually, I'm not that sympathetic. Sometimes you have to take a stand.
And that sociopathic cesspool you're speaking of? ... yes, that's right, you could be talking about X/twitter.
So, I appreciate your words of empathy, they're much needed in these times. But I'll be the asshole who dismisses them on this occassion.
Most of the workers stuck at X are on H1B visas or similar, which require them to keep their job or immediately find new employment at a company that will sponsor them.
Active users on the site is setting records pretty regularly, according to Linda. Usability and performance of the site is far higher than before in my experience as well. Revenue is down only due to an illegal cartel boycott, which X has recently filed a lawsuit to resolve.
I've only seen the words "illegal cartel boycott" being used (verbatim, as it were) by Musk, as well as the Twitter account of something called Rumble who are apparently joining Musk in trying to sue the advertisers who left the platform in response to it becoming too volatile to associate their brands with.
Is this the illegal cartel boycott you're talking about?
Would it not be an expression of free speech and advertisers' choice to disassociate from another entity, seen through the lens of Musk's famous free speech absolutism combined with corporate personhood? At worst, wouldn't it be the invisible hand of the free market acting to telegraph reduced demand in a resource by its previous consumers?
This take, which is taken straight from Elon, is plainly hilarious.
They claim to be the last bastion of free speech, but when advertisers exercise their free speech and go advertise someplace else, suddenly that's unacceptable.
Same way Elon goes on and on about how they won't moderate hate speech and will only ever delete content if it's illegal by law, 'cause "otherwise it'd be censorship". But then with the legal and publicly available information posted by ElonJet, that was different and everybody who ever mentioned it was banned.
>Government using force, whitewashed with a thin veneer of an NGO to cartelize advertisers and censor twitter is not “free speech”.
This is squarely in conspiracy theory territory, but doesn't really justify the thought that association between any group of private entities could be compelled.
> You pretended to be unaware of the situation then you straight up lie to push the dishonest narrative.
I think this may have been in reference to another commenter.
> You support censorship.
I literally have spent much of my career on teams trying to find technical workarounds to online censorship in dictatorial regimes. What Musk's Twitter stands for these days is closer to the censorship seen in those places than it was before Musk took over.
I'll also add that what the US Right often decries as censorship is... jarringly hypocritical, at best. I won't get started on here.
> This site literally bans anyone who defends conservative positions.
Summarily incorrect. I don't know that there have been any high-profile bans since I joined, but HN does delete conversations where people who aren't constructively participating in the thread are. It wouldn't surprise me if this thread got removed, for example.
I'm not going to entertain your remaining points since those aren't really substantial enough to even talk about.
This is just another of Musk's "free speech for me, but not for you" lawsuits that never go anywhere and are designed to waste your money with lawyers.
I don't know if you are serious but because of LLMs trained on our work basically every tech company is scrambling for ways to get rid of programmers. Just yesterday I commented in a thread here where someone said 80% of their work is LLMable "bullshit" (somehow that guy, like many, didn't connect it to headcount or likelihood of keeping own job...)
Even if it wasn't for LLMs, it feels like a long time since I did more than convert someone else's Figma (or Adobe XD, or Photoshop document) into code, and glue it to a pre-existing API.
I'm sure real estate lawyers feel much the same about how rote their work is.
People pay for that, and it's valuable, but it does feel like these tasks should've been automated away a decade ago, without LLMs.
Lawyers or real engineers can only push a button and still have secure jobs because they have licenses/certifications/boards and liabilities with consequences. There is no such thing in programming. (Even though our mistakes can and do also lead to real people dying)
> it feels like a long time since I did more than convert someone else's Figma (or Adobe XD, or Photoshop document) into code, and glue it to a pre-existing API
That looks like webdev, that's like a minuscule part of all programming in question.
> automated away a decade ago, without LLMs.
I think LLMs is the worst part of it because literally what programmers do is used against them. It's like taxi drivers used to train self driving cabs to automate themselves out of jobs, except imagine self driving cars actually worked and there are no unions or protective gov regulation and taxi drivers all cheer for this because each thinks the whole firing and pay reduction is only for someone else not themselves:)
"Work" isn't Boolean — the self drive AI does exist, just not well enough to do everything and even the "F" (though the Waymo AI seems to be?)
The same quality may be worse or better in specific roles, but AI isn't stationary.
> It is why unions/gov protections/certifications exist... accountability and keeping society from unraveling
No, but it is why the Amish and literal communism existed — but in the latter case, they weren't opposed to the automation itself just the unfairness of using profit to make workers redundant.
Unions are more about fair pay for fair work, and safe conditions in that work. Certifications are consumer protection.
Dunno much about the Amish. Communism was (in practice a power grab, but in theory) very much in favor of automation. Hyping LLM training without licensing original works and calling for banning copyright and patents is what reminds me of communism a lot these days. I saw someone call it "IP communism". Let's see how well it works for innovation;)
I am not against automation too. We all used autocomplete. But it is amusing to see people sawing off the branch on which they sit, encouraging each other to do so and spitting on people who point it out.
I don't believe in communism and I think anarchocapitalism is maybe as bad as communism.
> Certifications are consumer protection.
If you think certifications are just consumer protection then you are missing big part of the picture. In the end it is protection for every side.
I've only seen half the stuff you're calling "IP communism", but many are inspired by the "fully automated luxury gay space communism" meme, so sure :)
> I don't believe in communism and I think anarchocapitalism is maybe as bad as communism.
I've met both, and yup; though the communists seemed more sociable, neither could really understand that the other existed except as caricature.
> If you think certifications are just consumer protection then you are missing big part of the picture.
I was unsure if I should have written "also" in that sentence; but I didn't write "just" ;)
FWIW, I'm fairly sure the communists I know have a blind spot for all the failures of communist governments and not just the USSR's failures, they put Marx on a pedestal and insist the evidence to the contrary doesn't count somehow.
As I see equivalent blind spots in anarchocapitalism (any example of bad outcomes is dismissed as "not real free market"), that's why I don't think either communism or anarchocapitalism works.
