Twitter still has a lot of users and if they stopped being used by offensive at times racist and awful, then Twitter could get more users, sell advertising and make money probably. Now that's all gone because Twitter could investors need w own a small piece of the giant over inflated Xai, which has value because of AI hype but it's future actual value is questionable. There are so many other AI companies, so what is it that xai can do that justifies an $80 billion valuation?
> if they stopped being used by offensive at times racist and awful, then Twitter could get more users, sell advertising and make money probably.
That's a big if, and I think most people would be pretty skeptical of the possibility of that happening. The fact that outside investors seem to value it at under $10B suggests that's a common enough opinion.
To me, "make money" only implies financial sustainability. Do you take it to mean unicorn levels of cash?
I had an employer taken over by PE and shredded, for the crime of only managing 10% profit margin. Apparently, to some, if 20% of revenue doesn't go into someone's pocket, your business is a corpse. I think the world needs to chuck that attitude in the bin.
Opportunity cost is what the business can earn by investing in something else, usually something less risky than what the business is doing. If the business cannot earn more than the opportunity cost, it's a losing investment.
Businesses often use an opportunity cost of around 14%, so if the business is earning only 10%, then they are losing 4%.
For example, if you start a risky venture that earns 2%, when you could invest the money safely in bonds at 5%, it doesn't make sense to do the risky venture.
It's not an "attitude", it's maximizing the use of the money.
This thinking by American business is why tariffs will never bring back whole sectors of manufacturing to US shores. It's not business American companies want to get involved with.
'if you start a ̶r̶i̶s̶k̶y̶ venture that earns 2%, when you could invest the money safely in bonds at 5%'
The US invented flat screen technology. The return on manufacturing didn't fit American business profit levels so they sold the technology off to overseas companies. Tariff's aren't going to fix that. They might artificially boost the return short term, but unless we are going permanent protected markets this sort of low return manufacturing isn't coming back, because of American management style, not 'Canada bad', not 'trade deals bad'. If anything a better cause statement would be to say 'American MBAs bad'.
The discussion way back when they interviewed executives about LCD patents/research being sold of was that they were just too low of a profit margin to bother pursuing. I believe it was a 60 Minutes piece but it may have been a nightly news piece at the time.
If business costs are lower offshore, that raises the profit margin for the busines to go there. It doesn't mean that offshore businesses accept lower margins.
Understood. But what you have described is an attitude. Another possible attitude is being happy to lose money, hand over fist. Somewhere in between, there used to be a multi-billion company that made a piffling 10% margin on revenue.
You need some diversity in a system to remain able to change. Very homogenous populations are more likely to be wiped out in a crisis. Maximal efficiency is not maximal meta-efficiency.
Well: with the exception of Q1 2020 they were profitable from 2017 until Musk bought the company. Their last year was lower due to a lawsuit settlement but they were making significant profits until his acquisition added huge debt service obligations and tanked revenue.
Yes, like a lot of tech companies they weren’t focused on profits until their CEO prioritized it over growth but from that point on they were profitable from 2018 on, with the aforementioned bad quarter when everyone cut spending at the start of the pandemic. The one-time deferred lawsuit payout in 2021 masked what otherwise would have been several hundreds of millions in profit.
The problem people had understanding them was that they weren’t Facebook or Google. The expectations of a money-printing machine were unrealistic but they had a solid middle-tier business with a large number of solid customers.
Actually I think that's a great observation! I hadn't thought of that one. But Facebook, open AI, Google, Microsoft have even more money than musk and I'm sure they wont allow that.
