Elon Musk talks about finances on Twitter, and says his move averted a $3 billion deficit

Twitter owner and CEO Elon Musk He defends the major changes he’s made to the platform since taking over, saying they were meant to address a significant revenue shortfall at the social media giant.

Musk said during a conversation via Twitter Spaces on Wednesday that the company was heading toward a “negative cash flow situation of $3 billion a year” when he took the helm, explaining, “That’s why I’ve spent the last five weeks cutting costs like crazy.”

Elon Musk immediately began cutting back on Twitter’s workforce after he bought the company in late October. (AP Photo/Jae C. Hong, File/AP Newsroom)

The billionaire, who also heads electric car maker Tesla, immediately began cutting Twitter’s workforce after he bought the company in late October. within a week, Almost two-thirds Of the platform’s 7,500 employees, they were out of work.

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In addition to cutting costs through terminations and ending some perks at Twitter’s headquarters, Musk has made a number of moves aimed at increasing revenue, such as charging users for verification fees.

Elon Musk's Twitter account

Elon Musk believes Twitter should be back on track financially in 2023. (Nathan Sterk/Getty Images/Getty Images)

Twitter’s new owner admitted his actions “can sometimes seem bogus or weird or whatever,” but said they were necessary because “we have emergency fire training on our hands.”

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Musk said he had to act drastically Twitter changes Because otherwise the company was headed for disaster. From his point of view, he said, it was like “being in a plane heading for the ground at high speed with the engine on and the controls not working”.

Twitter logo on the phone

Twitter owner Elon Musk has made significant changes to the platform since taking over last month. (Omar Marquez/SOPA Images/LightRocket via Getty Images/Getty Images)

But he now believes that Twitter should be back on its financial path in 2023.

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“With the changes we’re making here around significantly lowering burn rate and building subscriber revenue, I now think that Twitter will, in fact, be okay next year,” Musk said during the Spaces discussion. “I think we’ll be… roughly the cash flow equation — that’s what I forecast for next year.”

Musk said earlier this week that he would step down as CEO of Twitter once he finds a replacement, after Twitter users in a poll voted for him to step down.

Reuters contributed to this report.

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