Yahoo Finance's Dan Howley breaks down a Financial Times report that Elon Musk's first debt interest bill will be due soon for the billionaire's Twitter purchase.

Video Transcript

[AUDIO LOGO]

RACHELLE AKUFFO: Please pay immediately, Elon Musk's $44 billion Twitter deal was funded in part with bank-backed debt. And the due date for his first installment is reportedly due soon, this according to "The Financial Times." Here with the details and more from Musk world is Yahoo Finance's Dan Howley. Dan, never a dull day for Elon Musk.

DAN HOWLEY: No never a dull day at all. He basically financed, or partially financed, this deal with $12.5 billion in debt. And so he's going to have to start paying up on some of that. The interest payment that seems to be coming due is around $300 million. That's according to these reports.

So he's going to have to figure out a way to ensure that Twitter can pay that. If he doesn't, then that could obviously lead to bankruptcy. Proceedings but this is one of the first debt payments that he's going to have to make on those loans.

And so this comes at a time when Twitter is dealing with a drop in advertising revenue that seems to be almost unheard of. According to different reports, some of the drop is as much as 50%. That's according to "The Information--" sorry, 40%, with 500 of the company's top advertisers stepping away.

Now, part of the problem is that a number of advertisers left initially because they weren't sure of how Elon Musk was going to treat the company, whether or not he would allow unfettered speech. He did bring back some of the people that were banned on Twitter initially, notably Andrew Tate, the right-wing kind of personality. He was then obviously arrested after going toe-to-toe with Greta Thunberg.

But then he also seemed to try to get advertisers-- attempt to strongarm advertisers into coming back by shaming them or threatening to shame them on Twitter. Obviously, there was also the debacle with Twitter Blue where, when it initially rolled out, there were people that we're putting up fake accounts, claiming to be from major advertisers like Eli Lilly and then buying those blue checkmarks when, in fact, they actually weren't those. And that caused stock prices to drop for those companies that ended up being impersonated.

So it's just been this overall just awful experience, seemingly, for Twitter so far. And it doesn't seem like the news is getting better.

All the while, Elon Musk tweeting about how the actual product on the server side of things is improving.

RACHELLE AKUFFO: And you mentioned that blue checkmark as part of Twitter's efforts to try and turn a profit. And we now have some clarity on Twitter Blue pricing for Android. Tell us more about that.

DAN HOWLEY: Yeah So the pricing is going to be $11 a month if you sign up on Android. That's the same as if you sign up for iOS. You sign up on the web, you pay $8. Now, this is confusing. Obviously, if you're not following the space, you don't recognize why these prices vary.

It's because Apple and Google both charge fees when things are sold through their app stores. That's that 15% to 30% fee that they both charge. So what Elon Musk is seemingly doing here is trying to recoup that by raising the price on iOS and Android to $11 while you can buy for $8 a month on the web.

Now, if you want, you can get a savings if you go to the web. You can pay $84 for a full year. But this kind of goes to the point of Elon Musk, at this point, needing to generate revenue in some way. And while app developers would generally say, look, we don't like the idea of iOS or Android having those fees in place, forcing us to charge more to users, this seems to be a larger issue for Twitter just because it's in this situation where it needs to pay back this debt.

RACHELLE AKUFFO: Indeed, I still remember Elon Musk saying buying Twitter was not about the money. It's definitely not the case, as we can see. Dan Howley there, thanks so much.