Elon Musk I was never accused of a little dream. He’s reinvented at least two industries with Tesla, his electronic car company, and SpaceX, his rocket company — and now his ambitions are moving to $44 billion acquisition of Twitter.
Mr. Musk, the world’s richest man, has given a promo to investors in recent days outlining his grand – some might say incredible – plans for Twitter and his financial goals. The New York Times got the presentation. Here’s a sneak peek at what Mr. Musk sees as serving social media in the coming years.
Quintile revenue to reach $26.4 billion by 2028.
In his promo, Mr. Musk claimed that he would increase Twitter’s annual revenue to $26.4 billion by 2028, up from $5 billion last year.
Reduce Twitter’s reliance on ads to less than 50 percent of revenue.
Under Mr. Musk, ads will fall to 45 percent of total revenue, down from about 90 percent in 2020. In 2028, ads will generate $12 billion in revenue and about $10 billion in subscriptions, according to the document. Other revenue may come from the business such as data licensing.
She has 69 million users of Twitter Blue.
Mr. Musk plans to boost Twitter user numbers with services like Twitter Blue, where users pay $3 a month to customize their experience on the app. According to the presentation platform, Mr. Musk expects 69 million users of Twitter Blue by 2025.
Generate $15 Million in Profits from Payment Business.
Twitter will bring in $15 million from the payments business in 2023, according to the document, which will grow to about $1.3 billion by 2028. The company’s payments business today, which includes tipping and shopping, is negligible. There has been speculation that Mr. Musk might offer payment capabilities to Twitter since he helped popularize PayPal, the digital payments service.
Increased average revenue per user by $5.39.
With all of these changes, Mr. Musk expects to be able to raise Twitter’s average revenue per user – a key metric for social media companies – to $30.22 in 2028 from $24.83 last year, according to the document.
Employed 3,600 employees – after laying off hundreds.
By 2025, Mr. Musk expects Twitter to have 11,072 employees, according to the document. that would be from About 7500 today.
But in between, Mr. Musk expects the number to fluctuate, rising to 9,225 employees in 2022, then declining to 8,332 employees in 2023 before rising again. Mr. Musk is likely to lay off workers as part of his tenure, before bringing in new talent in engineering, a person familiar with the situation said. Inventory-based compensation costs are also expected to rise to just over $3 billion by 2028, from $914 million in 2022.
Free cash flow raised to $9.4 billion.
Twitter will add about $13 billion in debt as part of Mr Musk’s buyout plan. But he expects that debt to be repaid as free cash flow — a measure of how much money a company has to service its debt — set to grow to $3.2 billion in 2025 and $9.4 billion in 2028, according to the presentation platform. According to the document, free cash flow will rise even as operating expenses and costs will also rise.
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