MarketWatch First Take: Twitter employees get a first glimpse of life under Elon Musk

If Elon Musk ends up buying Twitter, its employees got a glimpse of what life could be like with him in charge during an all-hands video chat Thursday.

In typical Musk fashion, he was late to the live virtual broadcast, inaudible some of the time and called in using his phone, according to reports by both the Wall Street Journal and the New York Times. Musk often keeps investors waiting ahead of Tesla

events, and at times has a rambling, ad-hoc style of speaking. But he did agree to a request from Twitter’s Chief Marketing Officer Sheryl Berland to go a bit longer. Berland asked some pre-submitted questions compiled from Twitter’s 9,600 employees.

A few things were clear from his comments, as reported: If Musk ends up with the company he has agreed to buy for $44 billion, he will very likely engage in job cuts; he is not a huge fan of working remotely; and he is inspired by China’s big, successful platforms TikTok and WeChat, which he said are “not boring.”

The self-dubbed “Technoking” of Tesla also made it abundantly clear that there will be a huge cultural divide between the company and its new owner, should his deal end up going through. Earlier this month, Twitter agreed to share a full data stream with Musk, who has asked Twitter for more data on the percentage of users that are bots or spam, saying that Twitter’s accounting of user bots is grossly understated.

“Obviously, layoffs are on the horizon,” said Dan Ives, an analyst at Wedbush Securities on Thursday, adding that he did not think the meeting would be reassuring to Twitter employees. “Clearly there will be a much different strategy under Musk.”

Musk said Twitter’s costs exceed its revenue, and “that’s not a great situation to be in,” according to a transcript compiled by ReCode. He also said a measure of future success would be if Twitter substantially increases its daily active users “at least” 1 billion in five to 10 years; Twitter now reports only on monetizeable daily active users, and it said it had on average 229 million monetizeable daily active users in the first quarter.

Musk was asked by employees about content moderation on Twitter, and he said that people should be allowed to say what they want, within the law. The Journal reported that he drew a distinction between freedom of speech and freedom of reach. Musk said users should be allowed to say “pretty outrageous things that are within the bounds of the law,” but that those posts should not necessarily be amplified. “The standard is more than ‘not offending people.’ The standard is, should be, that they’re very entertained,” he said, according to the transcript.

Shares of Twitter

initially jumped on Thursday on news of the video chat, but later fell almost 2% by the end of the trading session.

Ives said the meeting did not do much for investors. “I think it had the opposite effect — it wasn’t assuring, he didn’t talk about his recommitment to the Twitter deal and there were more questions than answers,” said Ives. “So overall, it was not a smart move.”

The next phase in the Twitter/Elon Musk soap opera will occur after Musk has reviewed the user data submitted by the company, as part of his ongoing quest to attempt to get a lower price. Wall Street clearly does not believe the deal, if it gets done, will be anywhere near Musk’s original $54.20-per-share offer agreed upon by both parties. The stock closed at $37.36 on Thursday.

“We think it gets done at $42-$45,” Ives said.

However it plays out, if Elon has his way — as many employees have feared — Twitter is never going to be the same.

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