While Twitter is famous for its controversial topics going well ahead of the platform, one of them has certainly made quite a noise all over the Internet. Tesla CEO, Elon Musk, revealed his intention to buy the network. Unfortunately, the first round of the negotiations failed, and both sides sued each other. Soon enough though, the businessman returned to the negotiating table and refused to walk away again. You know the rest: Musk purchased the platform for $44 billion.
So, the ordeal is over: let the renovation begin!
With that in mind, Elon Musk has started implementing a major overhaul at the platform, planning to launch new features, improve moderation techniques and stimulate monetization. Well, this is probably not the right time: Twitter share value has not yet shot up and remains at the same level.
Elon Musk, Catalyze!
When it comes to advertising revenue decline, Twitter is not an exception, wallowing in money. Even though the company received approximately $1,2 billion of revenue for the last two quarters, the free cash flow visibly deteriorated. Let us add a few numbers: the free cash flow margin reached an outstanding mark of minus 10,5% in the second quarter of 2022.
That's where Elon Musk's investments come in.
Intending to drive the platform further, the businessman is determined to change the strategy and advance the integration of buying services on Twitter to simplify the process of trading operations. Monetization as an option is also under reconstruction: Twitter may rely on content creators introducing them to a new (as-of-yet unspecified) revenue-sharing model.
These steps are expected to raise the platform's income and disengage from the unpredictable advertising market. If Musk succeeds, the company's share price will certainly increase.
Taking Risks
Before you decide to invest in Twitter, consider the risks and explore what exactly you're dealing with. In fact, to derive profit from the platform, Elon Musk is supposed to introduce a so-called 'growth plan' depicting further development of the network and monetization of new features. Then, the users, a very important factor: there's always a chance that they may or may not accept whatever Musk has to offer and switch to other platforms, for example, Mastodon.
As for the evident phenomena, global processes must not be neglected either: overall inflation, military conflicts, economic crash, and many other events can potentially impact your shares, so ponder them over and keep an eye on the political situation and the economic trends in the world.
Conclusion
In this article, we have breezed through the main aspects of Twitter, its shares, and possible investments. Right after the purchase, its stocks went up in price, which augurs well for the future as Elon Musk is determined to develop the network and increase the profitability. The new CEO plans to change the moderation pattern, expand shopping features within the platform and implement a crypto option to simplify transactions. Well, Godspeed, Elon! Can't wait to see what you come up with!
Disclaimer
Market opinions may not coincide with the editorial viewpoint. Traffic Cardinal does not provide investment advice. The material is published for review purposes only.
