[Asia Economy Reporter Lee Ji-eun] An analysis revealed that over 500 advertisers have left Twitter, the social media group acquired by Tesla CEO Elon Musk, resulting in a 40% decrease in daily advertising revenue compared to the previous year.
Major foreign media outlets reported this on the 18th (local time), citing sources. Since Twitter was acquired by Musk in October last year, controversies have arisen due to the dissolution of the board of directors, ruthless mass layoffs, and the restoration of former U.S. President Donald Trump's account, which relaxed content censorship. As criticism of Twitter grew, global companies consecutively stopped advertising on the social media platform. Moreover, the overall online advertising market froze last year, accelerating the departure of advertisers.
Forbes predicted that the company's financial difficulties would worsen since advertising accounts for 90% of Twitter's revenue. With Musk's acquisition, Twitter took on $13 billion (approximately 16 trillion won) in debt. Facing financial difficulties, Twitter failed to pay rent for its San Francisco headquarters, resulting in a lawsuit from the building owner, and to raise operating funds, it auctioned off unnecessary office supplies online following restructuring.
Given the situation, the investment banks that lent funds for Twitter's acquisition are discussing replacing Twitter's $3 billion high-interest unsecured loan with a Tesla stock-backed loan. Twitter's annual loan interest cost is estimated to be about 1.6 trillion won.
© The Asia Business Daily(www.asiae.co.kr). All rights reserved.
