Elon & Twitter

[Krugerrand]

I posted the real answer last night, but the Mod deleted it.

If Elon isn't selling shares to buy Twitter, but to keep it from going bankrupt, that is concerning, because he may have to keep selling if he can't turn the ship around.

Stop it. ‘-if he can’t turn the ship around-‘ Really? Really? Can you give him at least a few days to fix what was clearly an extensively dysfunctional company? Can you at least acknowledge that people here have already reported positive changes?

So many of you need to be hugged and then given a cookie.

 

[mongo]

Just relax and wait. Elon didn’t say that, people are speculating. The only desperation are those that can’t wait 30 seconds.

Yes he did, on the Twitter Spaces call with advertisers.
But that is a topic on the other thread.

 

[Drax7]

Just relax and wait. Elon didn’t say that, people are speculating. The only desperation are those that can’t wait 30 seconds.

Fair enough.
twitter needs wide mass appeal .
it needs to be compelling , and indispensable.
let’s us see how he assembles it.
His PayPal master plan will be his roadmap.
I wish him success.

 

[scottf200]

Yah. On the Twitter Spaces meeting, Elon said the plan is to have payments and later money market accounts via Twitter.

Yeah and Twitter is where who would want to have a money market account and why?

"Can I pay you with Zelle, Venmo, PayPal, Apple Cash?"

"No, I only take Twitter. I've got a blue checkmark so you can be sure it's me."

I think I'll stick with Ally for interest (2.75% currently), great customer service, fast transfers to my bank (1 day), and great budget bucketing tools.

https://twitter.com/x/status/1590974046971523073

 

[Krugerrand]

Ok so lets say Elon does. Why would anyone use/need another online payments platform?

No. Let’s not say he does and just wait to see what happens.

 

[2daMoon]

To me the real problem is that we don't know how much he needs to keep Twitter alive. If he has to sell $4B a year, who cares.

Any business in a transition period, particularly when significant changes are underway, will appear to be struggling.

As far as the effect this has on Tesla it should be a nothing-burger. There are many other elements affecting TSLA market price to account for. Most of which are challenging to quantify.

It would be fair to concede there are a lot of heavy hands whose interests are being disrupted by Tesla and some of them could be actively or passively making choices that weigh on the SP. This isn't necessarily a conspiracy, for any jumping that way, it is more about individuals making decisions that appear best for them in the moment. (though it is entirely possible that some may be coordinating their efforts)

Some of those efforts could certainly include amplification of aspects of the Twitter deal. These are being painted predominantly in a negative light with broad strokes in a manner so as to cast shade on Tesla. This tactic would be more about those being disrupted using the opportunity to control the narrative than it is about any direct aspect related to the mechanics of the Twitter deal itself.

Investors in TSLA ought to take this into consideration before publicly lashing out over Twitter's affect on TSLA as doing so contributes to the amplification and control of the narrative of those with hurting Tesla in mind.

Effectively, contributing to the narrative could be making things worse for those investors experiencing the most emotional discomfort. It may very well be that you are being played.

Food for thought.

HODL

 

[Mengy]

Another payment system , so many already.
Why bother, It feels like desperation.

You have to look at it from Elon's perspective:

YES, here on Earth another payment system isn't really needed. It could be a nice perk for Twitter and even make them some revenue, but that's not the big reason why Elon wants it incorporated into Twitter.

Think about Mars. Elon wants an "everything app" because such a service could provide a Mars colony with the majority of societal needs. Things like monetary transactions, social communications, video services, data searching, etc. All in one app.

So, while it might not seem like something we need here today, he's thinking very long term. VERY long term.

 

[Speedr117]

A few quick points:

• Bezos sells a billion dollars of Amazon stock every year to fund Blue Origin (his rocket company). No one says anything about it.
• Elon said yesterday that users keep increasing. So even though his competitors (sorry, I mean news media) say it's a disaster, the numbers seem to say otherwise.

 

[M|S|M MYP]

I really thought Elon was trying to make Twitter a better place:

 

[elasalle]

You have to look at it from Elon's perspective:

YES, here on Earth another payment system isn't really needed. It could be a nice perk for Twitter and even make them some revenue, but that's not the big reason why Elon wants it incorporated into Twitter.

Think about Mars. Elon wants an "everything app" because such a service could provide a Mars colony with the majority of societal needs. Things like monetary transactions, social communications, video services, data searching, etc.

So, while it might not seem like something we need here today, he's thinking very long term. VERY long term.

So as soon as you land on Mars, you'll use TWTr

 

[Krugerrand]

Fair enough.
twitter needs wide mass appeal .
it needs to be compelling , and indispensable.
let’s us see how he assembles it.
His PayPal master plan will be his roadmap.
I wish him success.

So apparently he did say that according to @mongo . I still think it’s way more useful to just sit back and wait and see what happens than to wring our hands with speculation and worry.

 

[Daniel in SD]

This number seems way too high for the revenue the company was making.

Their revenue was $5 billion in 2021 and apparently $800 million of the operating expenses were a one time charge due to a shareholder lawsuit settlement. So, without that they were just scraping by.
If I were to buy Twitter I would not have spent six months talking about how it is a fraud. I would have said nothing is going to change except the site is going to get more awesome! I would then spend six months getting the lay of the land and then do massive layoffs. Monday morning quarterbacking I know.

 

[ElectricIAC]

Their revenue was $5 billion in 2021 and apparently $800 million of the operating expenses were a one time charge due to a shareholder lawsuit settlement. So, without that they were just scraping by.
If I were to buy Twitter I would not have spent six months talking about how it is a fraud. I would have said nothing is going to change except the site is going to get more awesome! I would then spend six months getting the lay of the land and then do massive layoffs. Monday morning quarterbacking I know.

Interesting take but the head of the viper needed to go ASAP.

 

[AlanSubie4Life]

Monday morning quarterbacking I know.

Yeah no one could have predicted that might have worked out better.

 

[hacer]

Thats fine .... they will figure out its not that simple.

But the point about bots etc still holds. Nobody is going to get thousands of bots verified and pay for them.

With stolen credit cards what's to stop them? The Russian's have plenty of stolen credit cards to work with.

 

[mongo]

With stolen credit cards what's to stop them? The Russian's have plenty of stolen credit cards to work with.

Once card number gets shut down/ reported stolen, all linked accounts get deactivated.
100k accounts need 100k credit cards and only last until flagged.

 

[ohmman]

But he had a condition. Before paying the bonuses, Mr. Musk insisted on a payroll audit to confirm that Twitter’s employees were “real humans.” He voiced concerns that “ghost employees” who should not receive the money lingered in Twitter’s systems.

Mr. Musk tapped Robert Kaiden, Twitter’s chief accounting officer, to conduct the audit. Mr. Kaiden asked managers to verify that they knew certain employees and could confirm that they were human, according to three people and an internal document seen by The Times.

There are clearly more than 5% bots on the payroll!

https://www.nytimes.com/2022/11/11/technology/elon-musk-twitter-takeover.html

 

[hacer]

twitter currently is AWFUL to use when you search for latest election updates/ county updates etc. it feels like 2/3rds of tweets showing are coming from "verified" accounts (shocker, they get pushed by algo as Elon promised) but most aren't "verified" like in the pre-Elon days (aka. journalists/ political commentators, folks with a LOT of followers)... nah... a lot of fresh accounts with less than 5k followers who just "bought" their verification. Very hard now to decide who actually follows country election boards versus who is just trolling

That seems to be the whole point. The blue check is the "great leveler" so when you search for information it's just as probably that it comes from Qanon as from other sources and it will be hard to know who/what is behind what you actually see. When you don't have to figure out what is true, and what is not true then the algorithms become a lot easier and the playing field becomes "level".

 

[advocate8]

https://www.nytimes.com/2022/11/11/technology/elon-musk-twitter-takeover.html

Some of what he’s done lately is bizarre but can be written off as Elon being Elon, albeit at quad-espresso levels.
But that hunt for fake people on the payroll is so disconnected from reality that a diagnosis is probably possible here. And I aint talking about spectrum stuff.

 

[Gigapress]

Twitter already has at least two years of financial runway without any additional cash. I would be surprised if Twitter needed funding from Elon in order to stay solvent beyond the $4B Elon allegedly has already saved up just in case from these latest TSLA sales.

Twitter, Inc. - Financial information - SEC filings - SEC filings details

investor.twitterinc.com

• Generally, before the merger Twitter had been hovering slightly above breakeven with operating expenses eating up 80-90% of the gross profit

• $3B OpEx per year
  • R&D is half ($1.5B).
    • For comparison, Tesla spent $1.5B on R&D in 2020 and now is at $3B TTM. Since Tesla is doing a lot more actual R&D than Twitter is, I expect this expense will go down majorly due to Elon’s shakeup.
  • With half of the company laid off and presumably a bunch of Muskian efficiency improvements coming into play, OpEx probably will be more like $2B per year moving forward.
  • Elon tweeted that Twitter was losing over $4M/day ($1.5B/yr) before the layoffs
    • They laid off like 4K employees who were probably costing around $100K/yr so that’s roughly $400M in savings
  • Reuters claimed on Nov 3rd to have obtained internal documents and two anonymous sources indicating Elon was targeting $1B/yr savings on IT infrastructure expenses

https://twitter.com/x/status/1588671155766194176

• $6B cash, cash equivalents and short-term investments
  • 2+ years worth of runway with $3B OpEx assuming gross margin never goes negative
  • 3+ years if OpEx trimmed to $2B/year

• $5B long-term debt
  • Senior notes and convertible notes
  • Majority not due until 2025 or later

This is my first serious look at Twitter’s finances so I may be misunderstanding some context around the numbers. For one thing, I don’t know if any debt got added to Twitter as part of the merger.

As far as Elon saying Twitter might go bankrupt, it seems to me like he’s being dramatic about this stuff again, as usual, to prevent complacency and entitlement. He also said Tesla was within weeks of bankruptcy in 2018, which was an exaggeration based on assuming Tesla couldn’t raise funds to buy time for defeating Production Hell.

Technically bankruptcy is possible in the next year or two if Twitter’s gross profit dries up to nearly zero and Twitter gets no additional financing, but that seems pretty unlikely.

I don’t anticipate much more TSLA selling after this wave to cover anything Twitter related.