() — Elon Musk offered an optimistic picture Tuesday of how Twitter can improve the advertising business he helped derail and boost its bottom line, while admitting that keeping the social network running is proving challenging after multiple rounds of layoffs.
Speaking at a Morgan Stanley conference, Musk laid out his vision for boosting Twitter’s core advertising business by adopting the standard strategy of most of the company’s competitors: improve the relevance of the ads it delivers.
“The relevance of advertising is the biggest thing,” Musk said. “And this is going to sound totally weird, but Twitter didn’t factor in relevance in advertising until three months ago.”
With that change, and further cost cuts across the organization, Musk said he believes Twitter has “an opportunity to be cash flow positive next quarter.”
“In the future, Twitter will have very relevant and useful advertising,” Musk said. “And because it’s useful, because it’s relevant, there’s going to be a massive increase in revenue, because now it’s useful. So I’m very optimistic about the future. It’s been a very difficult four months, but I’m optimistic about the future.”
Since taking over the platform in late October, Twitter has suffered a mass exodus from big brands, as Musk relaxed some content moderation policies, restored inflammatory accounts and made a series of erratic comments about politics and world affairs. . Musk, who has already expressed his hatred of advertising on Twitter, was quick to bet on promoting a paid subscription offer, but it seems that he has struggled to gain traction.
He also took the time to thank the advertisers who have stuck with Twitter during his rocky takeover, including Disney and Apple.
But even as Musk tries to grow Twitter’s ad business, which has long accounted for nearly all of the company’s revenue, there are sincere doubts about whether the platform will be able to stay online.
Since Musk took office, Twitter has been inundated with service outages, including a major one on Monday, and other user headaches likely related to the multiple rounds of layoffs that occurred under his tenure. On Tuesday he blamed “overly complex” underlying technology for some of the recent service outages.
“The code base is like a Rube Goldberg machine, and when you zoom in on one part of the Rube Goldberg machine, there’s another Rube Goldberg machine, and then there’s another,” Musk said at Tuesday’s event. “So it’s pretty hard to keep this thing running, and then it’s also hard to move the product forward because it’s really too complex, to say the least.”
“We will make a change, what appears to be a small change somewhere, which then causes a massive disruption,” he said. Musk said Monday’s outage was the result of “what was supposed to be a small change for the top 1% of Twitter’s user base.” [que] It ended up being a catastrophic change for 100% of Twitter’s user base.”
At the same time, Musk continues to make controversial comments that may make brands wonder whether to return to the platform or increase their spending on it. Musk came under fire from some this week after he publicly mocked a disabled Twitter worker who asked the owner if he had been fired.
At Tuesday’s rally, Musk went off on a tangent and repeatedly took aim at the mainstream media. “What I would say to advertisers and brands is to use Twitter and believe what you see on Twitter, not what you read in the newspaper,” Musk said. “Because what you see on Twitter is real, and what you read in the newspapers is not.”
