Twitter ‘is a plane flying into ground’

After revealing the company is tearing through $4.5bn a year, Elon Musk says he’ll step down as CEO as soon as he finds someone ‘foolish enough’ to replace him.

Elon Musk has described Twitter as ‘a plane that is headed towards the ground at high speed with the engines on fire and the controls don’t work’. Picture: AFP

Elon Musk has described Twitter as a “plane that is headed towards the ground at high speed” after revealing that the company is burning through $US3 billion ($4.5 billion) a year.

The billionaire issued the warning about the state of the social media company’s finances after pledging to step down as chief executive once he finds someone “foolish enough” to replace him.

Musk made that promise after conducting a Twitter vote on whether he should continue in the role, following his $US44 billion ($65 billion) takeover of the company. Musk’s removal was backed by 57.5 per cent of the 17.5 million votes cast in the online poll.

He has said he plans to stay involved in day-to-day operations by overseeing Twitter’s software and server teams.

Musk has also defended his move to fire thousands of Twitter employees by outlining the cash crisis at the business. He told an online forum that he has “spent the last five weeks cutting costs like crazy”.

The Twitter boss warned that the company would struggle with its $US12.5 billion ($18.6 billion) debt pile as “the Fed [US interest] rate has been going crazy”. Twitter now spends about $US1.5 billion ($2.2 billion) servicing its debt and would suffer from net cash outflows of up to $US6.5 billion ($9.7 billion) next year. The billionaire added that with revenues likely to hit $US3 billion ($4.5 billion) in 2023, this would leave the company with negative cashflows of about $US3 billion.

He said: “So that’s the reason for my actions – they may seem sometimes spurious or odd or whatever. It’s because we have an emergency fire drill on our hands.

“That’s the reason, not because I am naturally capricious – or at least aspirationally, I’m not naturally capricious.

“If you’re looking at it from my standpoint, you’re saying: ‘OK, wow, this company is basically in a plane that is headed towards the ground at high speed with the engines on fire and the controls don’t work’.”

His departure as chief executive would draw a line under a brief, but remarkable, stint in charge. Since the end of October, he has halved Twitter’s workforce by laying off several thousand staff, struggled to push through sweeping changes and leaked internal documents about previous decisions to a handful of journalists.

Investors in Tesla, the electric carmaker led by Musk, have grown concerned that the social network has been distracting the billionaire from the rest of his empire. He also runs SpaceX, the rockets and satellites business.

His declaration that he plans to stand aside will heighten speculation about who could lead the social network. Musk dismissed most of its previous top executives after completing his takeover of Twitter.

Over the weekend, he suggested that identifying someone else to run the business would be a challenge. “No one wants the job who can actually keep Twitter alive,” he wrote. “There is no successor.”

The Times