You know things are going badly at a company when theories swirl that its new owner is purposefully trying to run it into the ground.

Deliberate or not, Elon Musk’s half-baked product launches and the gutting of Twitter’s workforce has led to chaos that could prove ruinous. In the last week, he has touted potential bankruptcy and watched key executives quit. Impersonators of politicians and brands who bought blue badges for $8 have been going viral before Twitter can suspend them. Nintendo’s Mario flipped off Twitter users for nearly two hours before its “verified” copycat account was taken down.

On Friday morning, Twitter appeared to have changed tack and suspended the $8 blue badge initiative. Maybe it was all too chaotic. Or maybe the departure of senior compliance staff has made it much harder to certify new products with the Federal Trade Commission. An in-house lawyer at Twitter warned engineers on Thursday that they needed to sort out FTC compliance themselves or face legal action, according to a memo reported in The Verge.

The lawyer added that Musk’s personal attorney, who currently runs Twitter’s legal department, had said Musk was taking risks because he “puts rockets into space [and is] not afraid of the FTC.”

How much upside is there to all that risk-taking? Not much.

Remember that if all of Twitter’s 400,000 originally verified users paid Musk’s $8 subscription fee, that would amount to about $40 million in revenue a year. That’s a fraction of the $1.2 billion Twitter made in second-quarter sales, about 90% of which came from advertising. But Musk, inexplicably, has said he wants half the company’s future revenue to come from Twitter Blue, currently going down as one of the most confusing and ill-fated product launches in history. (Meanwhile, banks are trying to offload Twitter’s buyout debt for as little as 60 cents on the dollar.)

Musk’s biggest mistake has been driving out Twitter’s advertisers with his behavior. No matter how many millions more people visit Twitter to gawk at the chaos, Musk really could steer the company toward bankruptcy if he can’t turn around his faltering relationship with brands.

Several big names like General Motors suspended their ads on the site, concerned that hate speech and misinformation under Musk would proliferate. Twitter executives had struggled to sell ad space for 2023 at an important advertising conference back in May 2022, because of all the uncertainty around the potential Musk deal, according to a tweet thread by Angelo Carusone, who runs media watchdog Media Matters for America.

Fortunately, hate speech and misinformation didn’t flood the site after Musk’s purchase, according to multiple studies. Misinformation was barely a blip during the U.S. midterms.

But Musk has still messed up the situation, and in several ways. By cutting much of the company’s ad team, he has ended the all-important personal relationships that its executives had with big brands. A misconception about online advertising is that the entire business is driven by algorithms and programmatic auctions run by machines. That’s not the case. “The transactions are digitally driven but the relationships starts with the [global ad sales] leadership,” said Matt Scheckner, chairman of Advertising Week, a conference organizer for the ad industry. “That whole team has been obliterated. … The part that [Musk] has missed is the human connection.”

Those relationships are especially important because Twitter’s ads aren’t as performance-driven as Google’s or Facebook’s. When a pharmaceutical company like Eli Lilly buys space on Google, its ads show up in search results related to a medical issue.

But on Twitter, brands buy ads to promote and create general awareness about their products. Of course, Eli Lilly has less incentive than ever to buy ads on Twitter after a parody account with a blue badge went viral this week.

Musk himself has admitted that Twitter is “vulnerable” because “70% of our advertising is brand,” according to a memo he sent to employees. That memo cited economic risk but didn’t mention that brands might balk just as much at a botched product rollout or the billionaire’s erratic behavior on the site, such as tweeting a conspiracy theory about the attack on Paul Pelosi or tweeting that Americans should vote for the Republican Party during the midterms.

Musk’s efforts to fix his relationship with advertisers hasn’t gone well either. On Thursday he held a public Twitter Spaces call — a live audio discussion that anyone on Twitter can listen to — with dozens of major brands like Warner Bros. Entertainment and Nike Inc.’s Jordan. Offering his assurances that Twitter was making sure there was “no bad stuff” next to ads, he said that Twitter was also working on helping to make ads more relevant and targeted toward users.

While Musk didn’t elaborate on how Twitter would do that, in a separate meeting with employees on Thursday he said the company would combine the technology powering its recommendation engines for ad and tweets, which until now have operated separately.

Yet this is precisely what the company’s departing lawyer warned against: Twitter can’t forge ahead with new products that process user data without special sign-off from the FTC. The regulator has said it is tracking recent developments at Twitter with “deep concern.”

Musk may go ahead with his plans anyway. He hasn’t only “put rockets in space,” as his lawyer said, but gotten slaps on the wrist and little else from the Securities and Exchange Commission for his previous transgressions.

That won’t stem the flow of losses to come as advertisers, who really don’t need Twitter as much Twitter needs them, take their money elsewhere. On Thursday, amid the mayhem, Musk was touting the rise of active users on his site.

“Usage of Twitter continues to rise,” he tweeted. “One thing is for sure: it isn’t boring!” But it might not be around for long.

Parmy Olson is a Bloomberg Opinion columnist covering technology. A former reporter for the Wall Street Journal and Forbes, she is author of “We Are Anonymous.”

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