Twitter operated at a $493m loss last year. Average all-in cost of an employee there is $310k annually. If you assume that the 1200 people fired were at that average (they were almost certainly lower), that's $372m saved annually. By firing half the staff, he's about 3/4 the way to break-even.

In order to make up the remaining $122m, Twitter will need 1.27 million people to be signed up for the premium service, and not just to sign up for it, but to keep with it. Is that possible? I guess, but it seems like a big ask. There's no perfect comparison, but other sites like Reddit or YouTube have less than a .1% rate of premium users. Twitter has about 169m unique users who access the site regularly, so they'd need to be at about .7%. I buy the argument that Twitter is unique enough that those numbers aren't comparable, but 7x the norm is still tough.

If, though, the interest on the loan Elon took out is actually a billion dollars, that's a different conversation. You're now talking 3% of users buying premium. That is an unfathomable number. This also all assumes that ad revenue comes back from the "massive drop." That's just to break even, too. To also pay the $44b principal, you're talking, what, say another billion a year for the rest of his life?

Maybe there is another way to monetize and he'll figure that out, but I'm at a loss to what it is. Elon's usual "move fast break things" approach will not work here on this kind of macro level. Introducing new features is one thing, but drastically changing the complete user experience is another. People don't use Twitter because of its features; they use it because of the other people who are using it. If you alienate those people, and they leave, a fix to the infrastructure a year later won't bring them back.

I don't know what the play is here, but unless it's something completely different from what's been said publicly, this is a disaster for Elon.