Twitter has lost nearly half of its advertising revenue since Elon Musk purchased it for $44 billion (£33.6 billion) last October, according to its owner.
He stated that the company did not observe the predicted growth in sales in June, but that July was “a little more promising.”
In an effort to save costs, Mr Musk fired over half of Twitter’s 7,500 employees when he took over in 2022.
According to some estimates, rival app Threads now has 150 million users.
Its built-in Instagram connection instantaneously grants the Meta-designed platform access to a potential two billion users.
Meanwhile, Twitter is laboring under a mountain of debt. Mr Musk stated over the weekend that cash flow remains negative, though the entrepreneur did not provide a time frame for the 50% decline in ad revenue.
In a tweet he said: “Need to reach positive cash flow before we have the luxury of anything else.”
Mr Musk stated that Twitter was on course to generate $3 billion (£2.29 billion) in income in 2023, down from $5.1 billion in 2021, after laying off thousands of people and slashing cloud service prices.
The development is the latest indication that aggressive cost-cutting measures have failed to entice advertisers who departed following revisions to its content moderation standards.
This is despite Mr Musk’s April interview with the BBC, in which he claimed that most people had returned to the site.
Meghana Dhar, the former head of partnerships at Snap and Meta, which owns the new Twitter rival Threads, said the company was floundering until Mr Musk bought it out.
Elon and Twitter are in a candidly tough position right now,” she told the BBC’s Today programme. “To be fair to Elon though, we’ve seen that decline in Twitter revenue and growth in revenue since pre-Elon – there’s been kind of a steady decline.”
Lucy Coutts, investment director at JM Finn, said: “You wouldn’t bet against him, he’s a kind of mercurial figure and I think probably he will turn it around but it is just going to take longer.
“But unfortunately he has got $13bn of debt to pay by the end of July so we may see more pressure on the shares in Tesla if he has to sell more of his stake in that company.”
Mr Musk is also the chief executive and majority shareholder of electric car-maker Tesla, which will report its latest quarterly financial results on Wednesday.
Linda Yaccarino, previously head of advertising at NBCUniversal, was taken on as chief executive of Twitter in June – a move suggesting advertising sales are still a priority for the company.
Ms Yaccarino has said Twitter plans to focus on video, creator and commerce partnerships. It is said to be in early talks with political and entertainment figures, payments services, and news and media publishers.
