Is it really impressive to reduce expenses drastically if you also reduce revenue drastically?
Secondly it's doubly unimpressive because I believe Musk could have actually maintained very similar revenue levels, but the haphazard and immediate way of laying everyone off was incredibly counterproductive.
Revenue went down a lot less than expenses. So yes, profits went up a ton and are now positioned to go up even more as revenue recovers and the tech keeps functioning.
The revenue reduction was also more related to political positioning/image than technical capacity of the platform.
Let's look it up together. Musk has approximately doubled X's profits from 0.68B to 1.25B.
[0] article quote:
"During the last full year prior to Musk’s takeover, Twitter reported adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization) of about $682 million and about $5 billion in revenue.
In 2024, X had an EBITDA of about $1.25 billion and annual revenue of $2.7 billion.
While X’s revenue is about half of what it used to be, the company’s costs are just about a quarter of what they were before.
As per the WSJ, investors noted that these were better figures than they had anticipated."
Even this [1] hilariously biased article is forced to admit in the middle that yes, X's profits have gone up since Musk took over.
"Now X also, of course, has reduced its overheads significantly, by culling around 80% of staff, so X’s profit margins are now much better as a result."
The word “adjusted” before EBITDA for 2021 is an important one: it references a one-time legal settlement that Twitter paid that year. If you don’t take that into account, the EBITDA was $1.47 billion.
Xai or whatever it's called was pumped with $6 billion, by, wait for it, fidelity. And, they still value X at 1/3rd of its original price. So, yes, the numbers will look good to people like you doing basic ebitda and revenue back of the envelope math. There's also no denying that the product sucks and users are leaving, which in turn will make your cute ebitda numbers look even bigger a few years down the line when there's only naz1s left!
Secondly it's doubly unimpressive because I believe Musk could have actually maintained very similar revenue levels, but the haphazard and immediate way of laying everyone off was incredibly counterproductive.