4 ms·
Twitter was doing fine financially, they were consistently floating around break even and they had lots of opportunities to move into profitability if their fin
by phphphphp 4y ago
Twitter was doing fine financially, they were consistently floating around break even and they had lots of opportunities to move into profitability if their financial situation became tenuous. As far as technology companies go, they weren’t anything to write home about, they weren’t printing money the way Google does, but they were doing fine.
Twitter doesn’t need to make constant product changes, as is evidenced by their ability to continue to support hundreds of millions of users and consistently generate billions of dollars of revenue: they’re valuable as-is. The Muskian narrative that Twitter needs better programmers who churn out more features is just not true.
I very much agree that Jack was half-assing management of the company but the consequence was that Twitter was falling far short of its potential, not that Twitter was struggling. If your argument is that the lack of profitability makes Twitter vulnerable to activist investors, then, well, you’re about a decade behind on market sentiment. Nobody cares about profitability any more: if the company can sustain itself, which Twitter could, then stock price is all that matters.
- x0x0 4y agoI don't think Twitter were fine: they were consistently losing money (to your point, not a ton, but still, losing money even in a great economy), with large layoffs to come, esp once you factor in a 20% or so fall in ad income. With more income cuts, and hence layoffs, on the way as privacy laws worldwide make Twitter worse as an ad platform. So I would argue that Twitter desperately needs to either get much better as an ads platform, or switch to some form of product that generates subscription revenues. I think that does require large changes and a bunch of features. Maybe not better programmers; probably just product pointing the programmers they had towards different features. And they already had been a target for activist investors; that was going to continue, regardless of the stock price. See Elliot Management in 2020/2021. So if Musk hadn't done this, I bet someone else would have.
- raydev 4y ago> they were consistently losing money ... with ever increasing revenue to cover it. If you take a look at the quarterly reports, clearly they had a spending problem and not so much a problem with ads. The business was fine. The leaders were not. Despite that, they certainly weren't bringing Twitter to the brink of bankruptcy.
- acdha 4y agoTwitter was profitable in a couple of recent years and would have been last year to the tune of several hundred million except for a one-find lawsuit payment. That’s not ideal, but all they needed to do to improve things was reduce their stock based compensation levels to be in line with their class of company rather than [old] Google/Facebook-level. That changed dramatically when Musk added over a billion dollars in annual debt payment load, and proceeded to torpedo their ad business. That changed it from “our boat leaks” to “the hull is gone”, and dramatically reduced the options for dealing with it.
- steve_adams_86 4y agoYou might even say the front fell off the boat
- baandang 4y agoTheir 2021 financial report is literally comical it is so bad for a company that should have been printing money. I can't stand Musk but my god did he give the shareholders a free lunch. I can't even imagine what the stock price would be right now with no deal.
- cmrdporcupine 4y agoPretty much "everyone" in the valley had large layoffs coming. Only Apple and Google have escaped it so far. This is a product of the stupid "grow unbounded" consensus that reigned there, not any idiocy unique to the companies.