Twitter reported disappointing results on Friday, a failure the social network attributed to “headwinds,” including uncertainty surrounding Elon Musk’s takeover bid.
The company is in a legal battle with the moody Tesla CEO over his efforts to back out of his $44 billion deal to buy the platform, leaving the company in limbo.
Twitter missed expectations with $1.18 billion in revenue due to “advertising industry headwinds … as well as uncertainty surrounding the upcoming acquisition of Twitter by a subsidiary of Elon Musk,” the company reported.
The news comes days after Twitter won a dispute with Musk when a judge agreed to a summary judgment on whether the billionaire should be forced to complete the acquisition.
Musk argues that the platform has been misled regarding the number of fake accounts on the platform, but the social media platform counters that he’s just trying to get out of business.
Musk’s attorneys had pushed for a February 2023 date, but the eastern Delaware court paid close attention to the uncertainty-plagued platform’s speed request and set an October launch.
– Lose money –
Billions of dollars are at stake, as is the future of Twitter, which Musk says should allow any legal speech – an absolutist position that has raised fears the network could be used to incite violence.
Twitter is left with anxious employees, wary advertisers, and management paralyzed while it limps while waiting to learn how the saga will end.
In early May, at an annual marketing event where companies negotiate large advertising deals, Twitter was “unable to give advertisers clarity or confidence” that it would continue to be a safe showcase for them, said Angelo Carusone, president of watchdog group Media Matters .
“They didn’t come close to achieving what they normally sell at this event. And since then it’s obviously been sluggish,” he previously told AFP.
The San Francisco-based social network can’t afford to lose customers.
Unlike big fish like Google and Facebook parent Meta, which dominate online advertising and make billions in profits, Twitter has lost hundreds of millions of dollars in 2020 and 2021.
According to eMarketer, the group will account for less than 1 percent of global ad revenue in 2022, compared to 12.5 percent for Facebook, 9 percent for Instagram and nearly 2 percent for booming upstart TikTok.
Additionally, Twitter’s user base in the United States is unlikely to grow and may even shrink, analysts have noted.
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