Twitter flags shortfall, cites Musk takeover uncertainty

WASHINGTON: Twitter reported disappointing results on Friday, a failure that the social network attributed to “headwinds” including uncertainty related to Elon Musk’s takeover bid.

The company is locked in a legal battle with Tesla’s mercurial boss over its efforts to pull out of its $44 billion deal to buy the platform, leaving the company in limbo.

Twitter missed expectations with revenue of $1.18 billion, due to “advertising industry headwinds…as well as uncertainty over Twitter’s impending acquisition by a subsidiary of Elon Musk,” the firm reported.

The news comes days after Twitter scored a victory in its fight against Musk, when a judge agreed to an expedited trial on whether to force the billionaire to complete the takeover.

Musk claims the platform misled the number of fake accounts on the platform, but the social media platform counters that he is simply trying to back out of the deal.

Musk’s lawyers had requested a date in February 2023, but the court in the eastern US state of Delaware closely followed the uncertainty-ridden platform’s desire for speed and set an October start.

Lose money

Billions of dollars are at stake, but so is the future of Twitter, which Musk says should allow all legal speech – an absolutist stance that has raised fears the network could be used to incite violence .

Twitter is left with anxious employees, wary advertisers and a paralyzed management as it limps along waiting to find out how the saga will end.

In early May, at an annual marketing event where companies negotiate major advertising deals, Twitter was “not able to provide advertisers with any clarity or confidence” that it would continue to be a safe storefront for them, said Angelo Carusone, president of watchdog group Media Matters. .

“They didn’t go far from what they normally sell at this event. And it’s obviously been slow ever since,” he previously told AFP.

The San Francisco-based social network can’t afford to lose customers.

Unlike big fish like Google and Facebook’s parent company Meta, which dominate online advertising and make billions in profits, Twitter lost hundreds of millions of dollars in 2020 and 2021.

The group will capture less than 1% of global advertising revenue in 2022, according to eMarketer, compared to 12.5% ​​for Facebook, 9% for Instagram and nearly 2% for booming TikTok.

On top of that, Twitter’s user base is expected to barely grow and may even shrink in the US, analysts noted. -AFP

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