Bankruptcy is possible, Musk tells Twitter staff amid executive exodus
Elon Musk, in his first address to Twitter employees since purchasing the company for $44 billion, said that bankruptcy was a possibility, according to a person familiar with the matter.
The Information and Platformer earlier reported Musk’s bankruptcy statement.
Henry Blodget, founder and head of news website Insider and a former stock analyst, tweeted Thursday that a Twitter bankruptcy could be “a powerful personal tax move” for Musk.
Yoel Roth and Robin Wheeler, two executives who until Thursday had emerged as part of Elon Musk’s new leadership team, have resigned, according to another person familiar with the matter, who asked not to be identified discussing non-public information.
Musk pushed out most of the social network’s top executives when his acquisition closed last month. Roth had since taken over all of the social network’s Trust and Safety efforts, while Wheeler, a sales vice president, had recently stepped up to oversee relations with jittery advertisers concerned about content.
The social network has a significant debt burden from the acquisition and has seen a pullback from some advertisers that are concerned about Musk’s plans for content moderation.
Musk also told staff on the call that the days of free food and other perks are over at Twitter’s offices, the person said.
Concerns over Twitter’s future are weighing on influencers, policymakers, journalists and other thought leaders.
In discussing Twitter’s finances and future, Musk said the company needed to move with urgency to make its $8 subscription product, Twitter Blue, something users will want to pay for given the pullback by advertisers affecting revenue.
Musk in an email late Wednesday warned employees of “difficult times ahead,” with “no way to sugarcoat the message” about the economic outlook for the company. He ended employees’ ability to work remotely unless he personally approved it.
The billionaire recently cut half of Twitter’s staff and introduced dramatic changes to its subscription rules. On Thursday, the changes resulted in multiple major advertisers getting impersonated by accounts with blue check marks, indicating verification.
Earlier Thursday, Twitter’s chief information security officer, chief privacy officer and chief compliance officer departed, raising concerns about the company’s ability to keep its platform secure and comply with regulatory rules. Twitter is bound by a consent decree with the Federal Trade Commission that regulates how the company handles user data, and it could be subject to fines for violations.
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