Musk warns of Twitter chapter as extra execs give up

November 10 (Reuters) – Twitter Inc’s new owner Elon Musk on Thursday raised the possibility that the social media platform could go bankrupt, capping a chaotic day that drew a warning from a US data protection agency and included the exit of the company’s trust and safety leader.

The billionaire said on his first mass call with employees that he couldn’t rule out bankruptcy, Bloomberg News reported, two weeks after buying it for $44 billion – a deal that credit experts say will throw Twitter’s finances into a put in a precarious position.

Earlier in the day, Musk warned in his first company-wide email that Twitter “would not be able to survive the coming economic downturn” unless it manages to grow subscription revenue to offset falling advertising revenue, said three people who saw the news Reuters.

Yoel Roth, who has overseen Twitter’s response to combating hate speech, misinformation and spam on the service, resigned on Thursday, two people familiar with the matter told Reuters.

In his Twitter profile on Thursday, Roth described himself as the company’s “former Head of Trust & Safety”.

Roth did not respond to requests for comment. Bloomberg and tech site Platformer were the first to report his exit.

Lea Kissner, Twitter’s chief information security officer, tweeted earlier Thursday that she had quit.

Chief Privacy Officer Damien Kieran and Chief Compliance Officer Marianne Fogarty also resigned, according to an internal message posted to Twitter’s Slack messaging system by a lawyer for the privacy team on Thursday and viewed by Reuters.

Robin Wheeler, the company’s top advertising sales manager, sent a memo to telling employees she was staying with the company, a person who saw the news said, and contrary to previous media reports, that she too would be leaving.

“I’m still here,” Wheeler tweeted late Thursday.

The US Federal Trade Commission said it was monitoring Twitter with “deep concern” after the three privacy and compliance officers resigned. These resignations potentially put Twitter at risk of violating government orders.

Musk’s attorney, Alex Spiro, told some employees in an email late Thursday that Twitter would comply with the regulations.

“We discussed our ongoing commitments with the FTC today and have a constructive ongoing dialogue,” Spiro wrote.

He explained that only Twitter, not individual employees, could be held liable for the orders.

“I understand that there have been staff at Twitter who aren’t even working on the FTC matter and commented that if we don’t comply they could go to jail – it just doesn’t work that way,” he wrote.

The Twitter app is seen in this photo illustration from July 13, 2021 on a smartphone. REUTERS/Dado Ruvic/Illustration//File Photo

In his first meeting with many employees at Twitter Thursday afternoon, Musk warned that the company could lose billions of dollars over the next year, the information reported.

Musk added in the email to employees that remote work is no longer allowed and they are expected to be in the office at least 40 hours a week.

Twitter, Musk, and Spiro did not respond to requests for comment about a possible bankruptcy, the FTC warning, or the departures.

Musk recklessly moved to a clean house after his Oct. 27 acquisition and said the company is losing more than $4 million a day, mostly because advertisers began fleeing after his acquisition.

Twitter is $13 billion in debt after the deal and will have to make nearly $1.2 billion in interest payments over the next 12 months. The payments exceed Twitter’s most recently reported cash flow, which totaled $1.1 billion at the end of June.

Musk has started charging $8 per month for the Twitter Blue service, which will include Blue Check verification.


“We are following recent developments on Twitter with great concern,” Douglas Farrar, the FTC’s director of public affairs, told Reuters.

“No CEO or company is above the law, and companies must follow our consent regulations. Our revised Consent Regulation gives us new tools to ensure compliance and we stand ready to use them,” Farrar said.

In May, Twitter agreed to pay $150 million to settle allegations by the FTC that it misused private information, such as phone numbers, to target users with advertisements after telling them the information was only being collected for security reasons .

Twitter’s privacy advocate mentioned in the internal memo on Thursday that Spiro had said Musk was willing to take a “big risk” with the company. “Elon puts rockets into space, he’s not afraid of the FTC,” the lawyer quoted Spiro as saying.

The Twitter acquisition has raised concerns that Musk, who has often meddled in political debates, could face pressure from countries trying to control online speech.

It prompted US President Joe Biden to say on Wednesday that Musk’s “cooperation and/or technical ties with other countries are worth reviewing.”


Musk told advertisers on Twitter’s Spaces feature on Wednesday that he aims to transform the platform into a force for truth and stop fake accounts.

His assurances may not be enough.

Chipotle Mexican Grill (CMG.N) said Thursday it had withdrawn its paid and owned content on Twitter “as we gain a better understanding of the platform’s direction under its new leadership.”

It joined other brands, including General Motors (GM.N), in suspending advertising on Twitter since Musk acquired it over fears he will relax rules on content moderation.

Reporting by Katie Paul in Palo Alto, California and Paresh Dave in Oakland, California; Additional reporting by Jeffrey Dustin in Palo Alto, Diane Bartz in Washington, Yuvraj Malik in Bengaluru, and Fanny Potkin and Hyunjoo Jin; writing by Sayantani Ghosh; Edited by Shounak Dasgupta, Bill Berkrot, Deepa Babington and Sam Holmes

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Father Dave

Thomson Reuters

Tech reporter from the San Francisco Bay Area covering Google and the rest of Alphabet Inc. Joined Reuters in 2017 after four years at the Los Angeles Times focusing on the local technology industry.

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