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Elon Musk expects Twitter to hit cash flow break even next year

Credit: @BigImpactHumans/Twitter

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During a Twitter Spaces session hosted by noted hacker George Hotz, Tesla CEO Elon Musk shared some details about the social media company’s financials. These include Twitter’s previous trajectory, as well as when he expects the company to become cash flow break even.

Musk stayed in the Twitter Spaces session for roughly an hour, and he addressed a number of questions. Hotz, the host of the Twitter Spaces session, noted that not many CEOs, if any, actually participate in such sessions. That being said, Musk did not waste time, as he provided a number of notable details about Twitter.

Musk noted that Twitter was tracking to spend about $5 billion next year. Because of debt on transaction, $1.5 billion in debt servicing was required. Twitter’s revenue was also tracking to $3 billion. “So that’s like a negative cash flow situation of -$3bn next year. Not good,” Musk said. 

This, according to Musk, was why he spent the last five weeks “cutting costs like crazy.” “This company is like, basically, you are in a plane that is headed toward the ground at high speed with the engines on fire and the controls don’t work,” the Tesla CEO said. 

Musk was not exaggerating about this. Since his takeover, he has cut Twitter’s workforce by a notable degree, among other cost-cutting measures. But thanks to these efforts, Musk noted that he now expects Twitter to roughly hit the cash flow break even point next year. 

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“I now think that Twitter will, in fact, be okay next year,” Musk said, though he admitted that accomplishing such a feat “will be difficult.” 

Apart from his comments about Twitter’s financials, Musk also admitted to some of his errors as of late. These include the suspension of Paul Graham, a respected venture capitalist who has been supportive of Musk. “Yeah, that was a mistake,” Musk said, noting that Graham could post about rival social media platform Mastodon as much as he wanted. 

Elon Musk completed his acquisition of Twitter in October for $44 billion, partly funding the purchase through the use of nearly $13 billion in debt. The interest on this debt will result in annual repayments of approximately $1.5 billion, as noted by Bloomberg News. Musk has since laid off over half of Twitter’s staff, and he has announced that he is open to stepping down as CEO once a suitable replacement is identified.

Don’t hesitate to contact us with news tips. Just send a message to simon@teslarati.com to give us a heads up.

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Simon is an experienced automotive reporter with a passion for electric cars and clean energy. Fascinated by the world envisioned by Elon Musk, he hopes to make it to Mars (at least as a tourist) someday. For stories or tips--or even to just say a simple hello--send a message to his email, simon@teslarati.com or his handle on X, @ResidentSponge.

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Tesla faces emission credits tax in Washington state

House Bill 2077 taxes emissions credits, mainly hitting Tesla. Lawmakers expect $100M/year from the taxes.

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(Credit: Tesla)

Washington state lawmakers are advancing a bill that would tax Tesla’s emission credits, targeting profits under the state’s clean vehicle policy. Lawmakers who support the bill clarify that the Tesla credit tax is unrelated to Elon Musk.

HB 2077, introduced in mid-April, seeks to impose a 2% tax on emission credit sales and a 10% tax on banked credits. The bill primarily affects Tesla due to exemptions for companies with fewer credits.

In 2022, Washington’s Department of Ecology mandated that all new cars sold by 2035 be electric, hydrogen-fueled, or hybrids, with 35% compliance required by next year. Carmakers selling more gas-powered vehicles can buy credits from companies like Tesla, which sells only electric vehicles.

A legislative fiscal analysis projects taxes on those credits would generate $78 million in the 2025-27 biennium and $100 million annually thereafter. About 70% of the taxes will be allocated to the state’s general funds, and the rest will help expand electric car infrastructure.

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HB 2077 passed the state House eight days after its introduction and awaits a Senate Ways and Means Committee vote on Friday. At a House Finance Committee hearing, supporters, including union and social service advocates, argued the tax would prevent cuts to state services.

House Majority Leader Joe Fitzgibbon emphasized its necessity amid frozen federal EV infrastructure funds. “We didn’t have a budget crisis until this year. And we didn’t have the federal government revoking huge amounts of federal dollars for EV infrastructure,” he said.

Tesla’s lobbyist, Jeff Gombosky, countered that the proposal “runs counter to the intent” of the state’s zero-emission policy. Rivian’s lobbyist, Troy Nichols, noted a “modest” impact on his company but warned it could undermine the EV mandate. Kate White Tudor of the Natural Resources Defense Council expressed concerns, stating, “We worry it sets a dubious precedent.”

Fitzgibbon defended the tax, noting Tesla’s dominant credit stockpile makes it “one outlier” that is “very profitable.” “That’s the kind of thing legislators take an interest in,” he said. “Is it serving the interest of the public for this asset to be untaxed?”

With the legislative session nearing its end, the bill remains a key focus in budget talks in Washington.

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Tesla Takedown group takes victory lap and aims for Starlink and SpaceX

Following Tesla’s Q1 2025 results, which were below expectations, the Tesla Takedown group celebrated.

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Credit: Tesla

The Tesla Takedown movement has taken a victory lap following the release of the electric vehicle maker’s first quarter 2025 earnings. With the group feeling encouraged by its results with the EV maker, Tesla Takedown is now setting its sights at Elon Musk’s other ventures, such as Starlink and SpaceX.

Because high-speed and reliable satellite internet for people in remote areas and the most affordable spaceflight provider for the United States need to be damaged, it seems.

Tesla Takedown’s Victory Lap

Following Tesla’s Q1 2025 results, which were below expectations, the Tesla Takedown group celebrated. “Today’s earnings report sends a very clear message. The Tesla Takedown grassroots pressure is beginning to hit Tesla where it hurts – the company’s bottom line,” the group noted.

Of course, the fact that Tesla did not sell its best-selling car for the majority of the first quarter due to the new Model Y changeover was conveniently left out by the group.

Nevertheless, in a comment to Insider, Tesla Takedown noted that its post-earnings email had an open rate of 53%, far above the 30% open rate of its previous emails. It also noted that it saw more than 30 new anti-Tesla protests added to its Action Network page within about 24 hours of the Q1 earnings’ release. Lastly, its BlueSky follower count rose by 10% to 15%, far above its weekly social media growth of 5%.

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New Targets Acquired

Despite its name, Tesla Takedown is really more like an anti-Elon Musk group. Thus, it was no surprise that in a statement, the group noted that it is now setting its sights on Musk’s other ventures. As per Tesla Takedown, it is already making preparations for similar efforts against the CEO’s other ventures, such as SpaceX and Starlink. 

“Tesla Takedown has already started laying the groundwork to expand Tesla Takedown efforts to target other Musk businesses including SpaceX, Starlink, X and xAI,” the Tesla Takedown group noted.

Considering the absence of the Model Y in most of Q1 2025, Tesla Takedown’s alleged effects on the company and Elon Musk’s alleged brand damage could be determined more accurately this quarter. This Q2, after all, none of Tesla’s vehicles are paused, and the company seems determined to sell as many cars as possible.

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Tesla is trying to make a statement with its Q2 delivery numbers

Tesla’s aggressive promotions for its vehicles today are quite strategic.

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Credit: Tesla/X

It is no secret that Tesla had subpar delivery numbers in the first quarter. It was due to a number of things, most of all the changeover to the new Model Y across its factories worldwide. The results, however, were enough for critics, both longtime and new, to declare that Tesla is just about done.

Looking at Tesla’s recently rolled out promotions across its lineup, however, it seems like the electric vehicle maker is dead serious about proving its skeptics wrong. 

Promotions, Promotions Everywhere

Just recently, Tesla announced that it was rolling out yet another free FSD transfer program for its customers. Such a program is designed to encourage longtime Tesla owners who may be holding onto their old vehicles with FSD to upgrade to a newer car. Tesla noted that its free FSD transfer is available for the Model S, X, 3, Y, and the Cybertruck in North America.

Tesla also announced a 0% APR financing program for new Model 3 orders in the United States. The Model 3 Performance even received an extra incentive, with the company offering premium paint colors such as Deep Blue Metallic and Pearl White for free with every vehicle purchase. Owners of Model Y classic units are also offered a $2,000 discount off the price of a new Model Y. Cybertruck customers, on the other hand, are offered special leasing rates.

Over in China, Tesla has announced a five-year, zero-interest financing program for the new Model Y. A similar program was also made available for the Model 3 sedan.

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Taking Control of the “Demand Issue” Narrative

Tesla’s aggressive promotions for its vehicles today are quite strategic. The United States and China, after all, are two of the company’s largest markets. If Tesla wishes to post healthy delivery numbers this Q2, robust delivery numbers in the U.S. and China are practically required. 

When Tesla announced its earnings earlier this week, critics were overjoyed to see that the company had seen a notable drop in revenue. Arguments about the company’s demand issues were highlighted anew as well. It’s ironic, but just a few months after the Model Y secured its place as the world’s best-selling car by volume for the second year in a row, arguments about Tesla’s demand issues are abounding once more.

It remains to be seen if Tesla’s aggressive promotions this Q2 will make a difference in its vehicle sales worldwide. But if the company ends the second quarter with an impressive number of vehicle deliveries, it could take control of its demand narrative with authority. 

A Potential Elon Musk Point

A healthy delivery result for the second quarter may also renew faith among investors that CEO Elon Musk is indeed serious about leading Tesla to new heights. Over the past months, Musk’s attention had been evidently focused on his activities with the Trump administration’s Department of Government Efficiency (DOGE), but during the Q1 2025 earnings call, the CEO stated that he would be spending more time at Tesla starting May. 

This suggests that Musk would be extremely hands-on with the electric car maker for the majority of Q2 2025. Tesla is typically at its best when pushed by its aggressive CEO, so it would be interesting to see just how far the company could go before the end of June 2025.

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