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Good point. Also whenever Musk talks about making sacrifices to “make ends meet”, one should point out that Twitter was a perfectly profitable company with all

Good point. Also whenever Musk talks about making sacrifices to “make ends meet”, one should point out that Twitter was a perfectly profitable company with all those employees before the buyout.

wlesieutre 4y ago
Maybe, but if we're headed into a recession you can expect large cuts to advertising budgets
kgwgk 4y ago
For some values of "perfectly profitable": Year Net profit / loss ($mm) 2012 -79 2013 -645 2014 -577 2015 -521 2016 -456 2017 -108 2018 1206 2019 1466 2020 -1136 2021 -221
- vjeux 4y ago
  If you sum all of this, that's -1071 for those like me that were curious.
- koonsolo 4y ago
  I get it that this is about profit. But to be fair, you have to factor in the valuation of the company to see if something was gained or lost in all those years.
  - koonsolo 4y ago
    Did I say something stupid because of the downvotes? If a company chooses to reinvest the profit into the company, and therefore increases the valuation, it can be a gain, right? In that case no profit is made. If you have $1 loss and gain $3 valuation, that's a gain of $2, right?
    - s1artibartfast 4y ago
      From an owner/investor perspective, you are correct. From the perspective of the corporate entity, you don't count valuation as profit/loss. For example, Twitter didn't make 44B revenue this year on the sale and you won't see it on their budget. Stock holders made that money. Same will be true again if Elon sells it for a profit or loss.
      - koonsolo 4y ago
        True, but when the corporate entity makes revenue, you basically decide to either keep it as a profit, or reinvest into the company itself. You would assume that reinvesting means the company is growing and so is worth more. I get it that shares changing hands doesn't really change anything.
        s1artibartfast 4y ago
        I think that is a faulty assumption, and maybe that is what you got some down votes. A loss doesn't always mean reinvestment. Reinvestment doesn't always translate to growth. Growth doesn't always Translate to profitability or market value. It is staggeringly common that businesses fail despite investment and despite growth. Sometimes the product is bad or simply has limited scalability. Valuations can change rapidly based on expectations of future profit and market conditions. This is especially true in Tech and new companies where valuation is based on future potential and not current profitability. The general idea is that even if you do a lot of reinvesting and grow your market cap significantly, that market cap can evaporate if it seems unlikely that a company will actually turn into the cash machine people hoped that it would.
- hristov 4y ago
  Last full year (2021) was profitable if you ignore a massive one time shareholder litigation settlement payment. Usually one ignores these one time hits to evaluate the normal ongoing operation of the company.
  - 93po 4y ago
    I would argue that settlement payments are an indicator of poor management, and unless something happens like a buyout then you can assume poor management will continue and there will continue to be risks of things like settlements.
  - kgwgk 4y ago
    As I said, for some (not-so-perfect) values of "perfectly profitable". For the curious the impact on net income was 766 millions.
watwut 4y ago
Afaik, it had one profitable year after many years of loss.
- 93po 4y ago
  Don't let reality get in the way of space man bad narrative
amatwl 4y ago
IIRC, Twitter was operating at a loss, prior to the closing of Elon's purchase. See Q2 2022 Results here, net loss was $270 million -https://s22.q4cdn.com/826641620/files/doc_financials/2022/q2/Final_Q2'22_Earnings_Release.pdf https://s22.q4cdn.com/826641620/files/doc_financials/2022/q2... It's still an open question whether Twitter will succeed with Elon, but it definitely wasn't a healthy company prior to the purchase.
deleted 4y ago
[deleted]
lbotos 4y ago
Was twitter "profitable"? https://fourweekmba.com/is-twitter-profitable/ https://fourweekmba.com/is-twitter-profitable/ Or do you mean, "They were on track to be profitable?"

Good point. Also whenever Musk talks about making sacrifices to “make ends meet”, one should point out that Twitter was a perfectly profitable company with all those employees before the buyout.

wlesieutre 4y ago

Maybe, but if we're headed into a recession you can expect large cuts to advertising budgets

kgwgk 4y ago

For some values of "perfectly profitable": Year Net profit / loss ($mm) 2012 -79 2013 -645 2014 -577 2015 -521 2016 -456 2017 -108 2018 1206 2019 1466 2020 -1136 2021 -221

vjeux 4y ago
If you sum all of this, that's -1071 for those like me that were curious.
koonsolo 4y ago
I get it that this is about profit. But to be fair, you have to factor in the valuation of the company to see if something was gained or lost in all those years.
- koonsolo 4y ago
  Did I say something stupid because of the downvotes? If a company chooses to reinvest the profit into the company, and therefore increases the valuation, it can be a gain, right? In that case no profit is made. If you have $1 loss and gain $3 valuation, that's a gain of $2, right?
  - s1artibartfast 4y ago
    From an owner/investor perspective, you are correct. From the perspective of the corporate entity, you don't count valuation as profit/loss. For example, Twitter didn't make 44B revenue this year on the sale and you won't see it on their budget. Stock holders made that money. Same will be true again if Elon sells it for a profit or loss.
    - koonsolo 4y ago
      True, but when the corporate entity makes revenue, you basically decide to either keep it as a profit, or reinvest into the company itself. You would assume that reinvesting means the company is growing and so is worth more. I get it that shares changing hands doesn't really change anything.
      - s1artibartfast 4y ago
        I think that is a faulty assumption, and maybe that is what you got some down votes. A loss doesn't always mean reinvestment. Reinvestment doesn't always translate to growth. Growth doesn't always Translate to profitability or market value. It is staggeringly common that businesses fail despite investment and despite growth. Sometimes the product is bad or simply has limited scalability. Valuations can change rapidly based on expectations of future profit and market conditions. This is especially true in Tech and new companies where valuation is based on future potential and not current profitability. The general idea is that even if you do a lot of reinvesting and grow your market cap significantly, that market cap can evaporate if it seems unlikely that a company will actually turn into the cash machine people hoped that it would.
hristov 4y ago
Last full year (2021) was profitable if you ignore a massive one time shareholder litigation settlement payment. Usually one ignores these one time hits to evaluate the normal ongoing operation of the company.
- 93po 4y ago
  I would argue that settlement payments are an indicator of poor management, and unless something happens like a buyout then you can assume poor management will continue and there will continue to be risks of things like settlements.
- kgwgk 4y ago
  As I said, for some (not-so-perfect) values of "perfectly profitable". For the curious the impact on net income was 766 millions.

watwut 4y ago

Afaik, it had one profitable year after many years of loss.

93po 4y ago
Don't let reality get in the way of space man bad narrative

amatwl 4y ago

IIRC, Twitter was operating at a loss, prior to the closing of Elon's purchase. See Q2 2022 Results here, net loss was $270 million -https://s22.q4cdn.com/826641620/files/doc_financials/2022/q2/Final_Q2'22_Earnings_Release.pdf https://s22.q4cdn.com/826641620/files/doc_financials/2022/q2... It's still an open question whether Twitter will succeed with Elon, but it definitely wasn't a healthy company prior to the purchase.

deleted 4y ago

[deleted]

lbotos 4y ago

Was twitter "profitable"? https://fourweekmba.com/is-twitter-profitable/ https://fourweekmba.com/is-twitter-profitable/ Or do you mean, "They were on track to be profitable?"