4 ms·

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 sa

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.

jrpelkonen 2y ago
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?
- rahkiin 2y ago
  He’ll probably sell x.com to himself just before that happens
- zinekeller 2y ago
  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.
- chuckadams 2y ago
  He’ll probably name his next kid X. His history at PayPal shows how obsessed he is with that letter.
  - deeth_starr_v 2y ago
    He calls his first kid with Grimes X
  - ninininino 2y ago
    Already happened https://twitter.com/Garossino/status/1817220477427093963 https://twitter.com/Garossino/status/1817220477427093963
queuebert 2y ago
Maybe they could declare bankruptcy and sell for pennies on the dollar to a mysterious new holding company: Ksum Nole, LLC.
- seanhunter 2y ago
  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. [1] https://www.uscourts.gov/services-forms/bankruptcy/bankruptcy-basics/chapter-11-bankruptcy-basics https://www.uscourts.gov/services-forms/bankruptcy/bankruptc...
  - arresin 2y ago
    Nah uh. Mr Ksum would find a way.
  - queuebert 2y ago
    Yes, I know. It was a joke.
  - sebastiennight 2y ago
    Quick heads-up: I think you've written "debtor" instead of "creditor" a couple times in there.
runako 2y ago
> 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.
- mistrial9 2y ago
  > Debt service was estimated at ~$100m/mo source?
  - runako 2y ago
    Many sources for this, including: https://www.thestreet.com/technology/elon-musk-has-a-huge-twitter-debt-bill https://www.thestreet.com/technology/elon-musk-has-a-huge-tw... and https://www.nytimes.com/2022/10/30/technology/elon-musk-twitter-debt.html https://www.nytimes.com/2022/10/30/technology/elon-musk-twit... https://www.bloomberg.com/news/articles/2023-05-03/twitter-said-to-make-second-interest-payment-on-musk-buyout-debt?sref=Bgsklk5a https://www.bloomberg.com/news/articles/2023-05-03/twitter-s... If you don't like my choice of sources, any popular search engine will help you surface additional sources.
  - dragontamer 2y ago
    $13 Billion leveraged buyout means that Twitter took on $13 Billion in loans for the privilege of being bought out by Elon. Assuming a rough interest rate of 10% to 15%, leaves 100million to 150million / month on debt alone.
    - throwaway2037 2y ago
      > Assuming a rough interest rate of 10% to 15% Do you have a source on this? I couldn't find anything.
      - dragontamer 2y ago

jrpelkonen 2y ago

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?

rahkiin 2y ago
He’ll probably sell x.com to himself just before that happens
zinekeller 2y ago
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.
chuckadams 2y ago
He’ll probably name his next kid X. His history at PayPal shows how obsessed he is with that letter.
- deeth_starr_v 2y ago
  He calls his first kid with Grimes X
- ninininino 2y ago
  Already happened https://twitter.com/Garossino/status/1817220477427093963 https://twitter.com/Garossino/status/1817220477427093963

queuebert 2y ago

Maybe they could declare bankruptcy and sell for pennies on the dollar to a mysterious new holding company: Ksum Nole, LLC.

seanhunter 2y ago
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. [1] https://www.uscourts.gov/services-forms/bankruptcy/bankruptcy-basics/chapter-11-bankruptcy-basics https://www.uscourts.gov/services-forms/bankruptcy/bankruptc...
- arresin 2y ago
  Nah uh. Mr Ksum would find a way.
- queuebert 2y ago
  Yes, I know. It was a joke.
- sebastiennight 2y ago
  Quick heads-up: I think you've written "debtor" instead of "creditor" a couple times in there.

runako 2y ago

> 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.

mistrial9 2y ago
> Debt service was estimated at ~$100m/mo source?
- runako 2y ago
  Many sources for this, including: https://www.thestreet.com/technology/elon-musk-has-a-huge-twitter-debt-bill https://www.thestreet.com/technology/elon-musk-has-a-huge-tw... and https://www.nytimes.com/2022/10/30/technology/elon-musk-twitter-debt.html https://www.nytimes.com/2022/10/30/technology/elon-musk-twit... https://www.bloomberg.com/news/articles/2023-05-03/twitter-said-to-make-second-interest-payment-on-musk-buyout-debt?sref=Bgsklk5a https://www.bloomberg.com/news/articles/2023-05-03/twitter-s... If you don't like my choice of sources, any popular search engine will help you surface additional sources.
- dragontamer 2y ago
  $13 Billion leveraged buyout means that Twitter took on $13 Billion in loans for the privilege of being bought out by Elon. Assuming a rough interest rate of 10% to 15%, leaves 100million to 150million / month on debt alone.
  - throwaway2037 2y ago
    > Assuming a rough interest rate of 10% to 15% Do you have a source on this? I couldn't find anything.
    - dragontamer 2y ago