Elon Musk has never been accused of dreaming for a while. He has rediscovered at least two industries with Tesla, its electronics company, and SpaceX, the rocket company – and now his ambitions are shifting to acquiring $ 44 billion from Twitter.
Mr Musk, the world’s richest man, gave a presentation to investors in recent days, outlining his grand – some may say amazing – plans for Twitter and its financial goals. The New York Times received the presentation. Here’s a look at what Mr. Musk sees about the social media service in the coming years.
Five-fold revenue to $ 26.4 billion by 2028
In his presentation, Mr. Musk said he would increase Twitter’s annual revenue to $ 26.4 billion by 2028 from $ 5 billion last year.
Reduce Twitter’s reliance on advertising to less than 50 percent of revenue.
Under Mr Musk, advertising will fall to 45% of total revenue, down about 90% in 2020. In 2028, advertising will generate revenue of $ 12 billion and subscriptions nearly $ 10 billion, according to the document. Other revenue would come from businesses such as data licensing.
Add $ 69 million in Twitter Blue subscription revenue.
Mr Musk plans to increase Twitter subscription revenue with services such as Twitter Blue, for which users pay $ 3 a month to personalize their in-app experience. According to Pitch Deca, Mr. Musk expects revenue from Twitter Blue of $ 69 million by 2025.
From the opinion: Twitter of Elon Musk
Comment by Times Opinion authors and columnists on the billionaire’s $ 44 billion deal to buy Twitter.
Generate $ 47 million in revenue from Mysterious X.
A separate product, X Subscribers, will reach $ 47 million in revenue that year, according to the document. The document did not specify what the X Subscribers were, but Mr Musk hinted at introducing an ad-free experience on Twitter.
Generate $ 15 million in payment business revenue.
Twitter will bring in $ 15 million from the payment business in 2023, according to the document, which will grow to about $ 1.3 billion by 2028. The company’s payment business today, which includes tips and shopping, is insignificant. There has been speculation that Mr Musk may be introducing payment options on Twitter, given that he helped promote PayPal, the digital payment service.
Increase average consumer revenue by $ 5.39.
With all these changes, Mr Musk expects to be able to increase the average Twitter revenue per user – a key indicator for social media companies – to $ 30.22 in 2028 from $ 24.83 last year, according to the document.
Hire 3,600 employees – after losing hundreds.
By 2025, Musk predicts that Twitter will have 11,072 employees, according to the document. That would be more than about 7,500 today.
But among them, Mr. Musk expects their numbers to fluctuate, increasing to 9,225 employees in 2022, then declining to 8,332 in 2023, before increasing again. Mr Musk is likely to lay off workers as part of the takeover before attracting new engineering talent, said a person familiar with the situation. Share-based compensation costs are also expected to rise to just over $ 3 billion by 2028, from $ 914 million in 2022.
Increase free cash flow to $ 9.4 billion.
Twitter will add about $ 13 billion in debt as part of Mr Musk’s buyout plan. But he expects to repay that debt as free cash flow – a measure of how much money the company has to service its debt – is expected to rise to $ 3.2 billion in 2025 and $ 9.4 billion in 2028. , according to the test. Free cash flow will increase even as operating costs and expenses also rise, according to the document.
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