Elon Musk electronic mail to X employees: ‘we’re barely breaking even’

Ever since Elon Musk closed his deal to purchase Twitter he’s claimed the corporate, now known as X, is in “a really dire scenario from a income standpoint.”

Now, the Wall Avenue Journal stories that banks are getting ready a coordinated transfer to unload a few of the $13 billion in debt they loaned Musk to finance the deal. It mentions an electronic mail despatched to workers this month, additionally confirmed by The Verge, the place the Chief Twit mentioned, “…we’ve witnessed the ability of X in shaping nationwide conversations and outcomes,” but additionally claimed, “Our consumer development is stagnant, income is unimpressive, and we’re barely breaking even.”

A part of the rationale Financial institution of America, Barclays, and Morgan Stanley are holding a lot of the debt is from making an attempt to keep away from promoting at a loss after financial situations modified, and Musk had an prolonged courtroom battle making an attempt to get out of the deal. Whereas fairness traders have reportedly slashed the worth of their stakes by as a lot as 78 %, the Journal stories, “banks hope to promote senior debt at 90-95 cents on the greenback, whereas retaining more-junior holdings.”

As Musk referenced in his electronic mail, the report says the banks hope to make use of the narrative of Musk’s hyperlink to Donald Trump, as some unnamed traders could also be all for shopping for based mostly on a perception that its financials are on the best way up.

Nevertheless, Musk additionally mentioned that the corporate might grow to be cash-flow optimistic “inside months” practically two years in the past, and it nonetheless faces over $1 billion in annual curiosity funds on the loans. The platform is more and more turning right into a testing floor for his AI ambitions, as we reported earlier this month, and whereas X has added some options, like job listings and a brand new video tab, there’s little signal of the service he’d mentioned would be capable of “somebody’s complete monetary life” by the tip of 2024.