Elon Musk Plans to Quintuple Twitter’s Revenue, Hit 1 Billion Users by 2028: Report
Even though Twitter accepted Tesla and SpaceX CEO Elon Musk’s $44 billion USD takeover offer last week, the celebrity billionaire’s plans for the social media platform have been pretty vague.
Up until now, the bulk of what we knew was that Musk wants to make Twitter “the platform for free speech around the globe,” and that his takeover plan focused on job cuts and improving Twitter’s bottom line.
However, Musk has been sharing a pitch deck full of details on his ambitions for Twitter with potential investors as of late, and The New York Times was able to obtain the presentation. According to the publication, Musk’s primary goal is to quintuple Twitter’s revenue, from $5 billion in 2021 to $26.4 billion by 2028.
During this time, the electric vehicle (EV) and rocketry magnate also plans to decrease the share of advertising in the platform’s total revenue, from 90% in 2020 to 45% in 2028.
Musk estimates that advertising would generate $12 billion in revenues for 2028, while subscriptions would account for $10 billion and the remainder would come from a payments business, data licensing, and other segments.
Musk hopes to boost Twitter’s payments business, which currently includes tipping and shopping and generates negligible revenue, to a $15 million segment by 2023 and a $1.3 billion line item in the company’s income statement by 2028.
Another ambitious target Musk has for Twitter is to grow the total number of users on the platform to a whopping 931 million by 2028, from 217 million at the end of 2021. The presentation also says that 104 million of these users will be subscribed to a mysterious service referred to only as ‘X’ by 2028, while Twitter’s average revenue per user will be increased by $5.39, from $24.83 in 2021 to $30.22 by that time.
The pitch deck pegs the mysterious product, X, for a 2023 launch, with nine million users expected in its first year. What exactly this product will be is anyone’s best guess, but Musk has previously hinted at a possible paid, ad-free experience for Twitter.
Even though Musk is expected to make significant job cuts and reallocate resources after taking over, Musk’s plans ultimately involve increasing the total number of employees at Twitter from around 7,500 today to 11,072 by 2025. The company’s stock-based compensation costs are also expected to rise to over $3 billion by 2028, from just $914 million in 2022.
Musk also aims to raise Twitter’s free cash flow to an impressive $9.4 billion by 2028 in order to offset the $13 billion of debt his acquisition will add to the company’s balance sheet.
While Musk’s investor pitch features plans going all the way into 2028, Twitter may actually go back to being a publicly-traded company by then. A report from earlier this week indicates that Musk could take Twitter public again in as few as three years after acquiring the company.
A recent report says job interest in Twitter has spiked 250% since Musk’s takeover plans. On Friday, Musk said, “If Twitter acquisition completes, company will be super focused on hardcore software engineering, design, infosec & server hardware.”
He followed up to say, “I strongly believe that all managers in a technical area must be technically excellent. Managers in software must write great software or it’s like being a cavalry captain who can’t ride a horse!”.
Musk reiterated on Saturday morning Twitter work would be demanding. “Also, work ethic expectations would be extreme, but much less than I demand of myself,” added Musk.
Also, work ethic expectations would be extreme, but much less than I demand of myself
— Elon Musk (@elonmusk) May 7, 2022