TheQuartering [5/7/2022]
The Tesla guy, who had governments worried after he bought Twitter, is back with another major news announcement. Elon Musk intends to fire around 1,000 Twitter employees after completing his purchase of Twitter. Following the transfer of ownership, which is expected to take six months, Musk is expected to fire a large number of the company’s current employees. People are understandably not happy about it.
But here is something to wonder about because Musk also expects to add thousands of new people over the next three years, bringing up the total number of staff to about 11,000, up from the current 7,500. Moreover, engineering is anticipated to attract a large portion of the new talent. Seems like, the company’s workforce will fluctuate, rising to 9,225 this year before dropping to 8,332 in 2023. Then, by 2025, another 2,700 workers will be added.
According to New York Times, Musk presented a pitch deck to investors this week that show the majority of the job cuts would occur during the takeover stage. On a corporate level, Musk has previously suggested that the San Francisco headquarters be closed in order to save money, and that board members may not be paid, saving another $3 million in costs. The adjustments are part of Musk’s aim to grow Twitter’s annual income to $26.4 billion by 2028, up from $5 billion last year.
Under Musk, advertising on the platform will account for 45 percent of overall revenue, decreasing from around 90 percent in 2020. According to the report, by 2028, he expects commercials to produce $12 billion in revenue, with subscriptions bringing in another $10 billion. Musk is also thought to prefer a subscription-based approach to advertisement funding since it would free Twitter from ad pressure. He’s even recommended that customers pay using cryptocurrency. Elon Musk clarified that while businesses and governments may have to pay to use Twitter, the social media platform will continue to be free for “casual users.” It is unclear whether certain other groups such as non-profits and journalists would be exempt from such fees. Musk also expects Twitter’s cash flow to increase to $3.2 billion in 2025 and $9.4 billion in 2028, according to Musk.