171–180 of 250 posts
Mid term (2-5 years) it seems like it would be optimal for Twitter to leave SF. Downtown isn't that great to work in and the Elon hate is red hot. They could still keep their SF employees as a satellite office. Bailing on what is surely a very pricey lease is an attractive bonus :-). Though, it would be hilarious if Twitter's no work from home policy lead to downtown revitalization :0). I still think SF has a lot to…
Honest question here, do you think Twitter will be around in 2-5 years?
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Unless Twitter has no assets of any marketable value (which obviously isn't the case, the company itself just sold for 44 billion dollars) the landlords will get paid, worst case by having Twitter issue additional stock in a debt for equity swap.
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The key thing here is that the loan payments are new, and are greater than profits were before the loan payments. That doesn't necessarily mean they are losing money -- revenue could have increased, or costs decreased, to make up the difference. Losing money also wouldn't mean they're insolvent -- that only happens once liabilities exceed assets. Still, it's definitely a signal that creditors will take note of. Good…
Ehhh… loans are of course an important part of the books, as is profit, but I would hold that profit/loan payments is an obscure and unhelpful metric that a competent analyst is unlikely to utilize.
Obviously corporate finance is a very different world. Musk was obviously able to demonstrate to his new creditors' satisfaction that Twitter will be able to make these payments (I don't see evidence of an ulterior motive here). It's still a real concept. Not conclusive on its own, but it is a signal among many.
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It’s probably optimistic to assume that whatever engineers are left at Twitter will willingly relocate to Tennessee. Unless you mean that he’ll gut the company entirely and start anew in one of those states?
There are a lot of great engineers in TN who would gladly work at Twitter while getting that SFBA paycheck Actually Twitter moving to Nashville or Memphis could be the greatest thing to happen to these cities (Memphis more than TN)...if they make it
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There are a lot of great engineers in TN who would gladly work at Twitter while getting that SFBA paycheck Actually Twitter moving to Nashville or Memphis could be the greatest thing to happen to these cities (Memphis more than TN)...if they make it
I agree that plenty of devs in TN would happily take an SFBA paycheck without moving. But why in the world would any company, much less Musk’s Twitter, offer such a massively out of band salary? The entire point of moving to states like TN is to pay less for developers, not the same amount.
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it does signal ... that Twitter ... are distressed Disagree - this is automobile industry tactics where you pay your suppliers late and short because they have no choice. Musk is negotiating for lower rent.
> they have no choice A commercial landlord in downtown SF has many, many choices. The power imbalance here is not even remotely close to the one given in your analogy.
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I would be interested in knowing how many other tenants this landlord has chosen to file suit on when the tenant is 7 days over due (in default in 21st, filed the suit on the 29th)? Seem very aggressive. I wonder if politics has any bearing on their choice to file? Or the fact that Elon has publicly been considering closing the SanFran HQ?
The fact that Twitter currently has loan payments in excess of last year's profits could be a factor. Delaying means they will be more likely to be entangled in a bankruptcy and potentially get a worse outcome if they are. Even a low probability bankruptcy would encourage some urgency.
Reputation matters.
I wonder if any commercial real estate company would rent Twitter anything at this point. It's pretty clear Musk intends to save money by f*cking others. Might as well go 100% remote.
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Hmm, if you had net profit of X, and suddenly have a new expense of N * X, where N is greater than 2, I think that's worth taking note of, be it low payments, a lawsuit settlement, or otherwise.
It’s really not though. This comparison is just a bad way to think about things. We have plenty of well established financial ratios that tell you something useful about an org. This is not one of them. Interest expense hits net income. Actual debt payments do not. The ratio is out of whack if you didn’t make a profit last year or had a tiny profit. What are we actually trying to identify here? Insolvency? Leverage?…
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Unless Twitter has no assets of any marketable value (which obviously isn't the case, the company itself just sold for 44 billion dollars) the landlords will get paid, worst case by having Twitter issue additional stock in a debt for equity swap.
Many have been estimating it at well under a $10 billion valuation. Elon Musk just became the first person to lose $200 Billion. I'd not be so quick to assume creditors are all getting paid here.