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'Heavy debt': Elon Musk says Twitter cash flow negative after ad revenue declines (www.cnbc.com)
submitted 3 years ago* by to c/tech@kbin.social
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Musk said early Saturday that cash flow at Twitter remains negative because of a nearly 50% drop in advertising revenue coupled with "heavy debt."

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[–] 2 points 3 years ago (1 child)

I don't see how a social media site and an automobile company have much in common.

It's quite possible that Musk is better at some things than he is at other things. Engineering and manufacturing are quite different from maintaining a large social media company, the skills don't translate.

Another major difference is that Musk built Tesla up from a small size, so it was always structured according to his style and expectations of management, whereas he bought Twitter as an already-large company with an established corporate culture that didn't match what he would have done. That's the first time he's bought such a large pre-existing company, as far as I'm aware, and he's having huge problems "reshaping" it.

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  • [–] 6 points 3 years ago* (1 child)

    @FaceDeer

    @kuontom @const_void Bullshit. He did not found Tesla. And Tesla gets many billions of dollars of subsidies, something you can't do with Twitter. It's easy to imagine how Musk mismanaged Tesla just as badly as Twitter now, but with the advantage of the government saving him back then. Also, with ZIRP (zero interest rate policy) by the Feds, you can borrow money at basically zero cost anytime you want. You can string along a disastrous mismanaged company for years in that scenario.

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  • [–] 2 points 3 years ago (1 child)

    As I said:

    Another major difference is that Musk built Tesla up from a small size,

    Emphasis added. From Tesla's Wikipedia page:

    Tesla was incorporated in July 2003 by Martin Eberhard and Marc Tarpenning as Tesla Motors. The company's name is a tribute to inventor and electrical engineer Nikola Tesla. In February 2004, via a $6.5 million investment, Elon Musk became the company's largest shareholder.

    Given the current size of Tesla, being able to buy a majority share of it for a mere $6.5 million clearly makes it a very small company by comparison.

    Also, with ZIRP (zero interest rate policy) by the Feds, you can borrow money at basically zero cost anytime you want. You can string along a disastrous mismanaged company for years in that scenario.

    Why do any companies go broke, in that case?

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  • [–] 3 points 3 years ago (1 child)

    @FaceDeer

    @kuontom @const_void

    It is still a small company. It the size of Mazda just with way more hype and more funding. It is still consistent with the idea that he stole the company and just turned it into his plaything, funded primarily with other people's money.

    Almost no companies went broke in the last decade or so. Only the most incompetent companies have really failed recently, with the occasional bank failure here and there. But that will change eventually. All frauds eventually go bust. And if Tesla is one of them, it will happen sooner or later.

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  • [–] 2 points 3 years ago (1 child)

    Mazda is a "small company?" Ok.

    Plenty of companies have been going broke in the past decade.

    If Musk's companies are small I don't see why everyone's so obsessed with him.

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  • [–] 2 points 3 years ago

    @FaceDeer

    @kuontom @const_void

    2023 is the beginning of the end of ZIRP. Of course starting now, a lot of companies are going bankrupt. But that hasn't reached Tesla yet.

    Also, who goes around thinking Mazda is this huge company? Sure, it is a not as small as say, a startup company, but it is still consider small.

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