Twitter’s revenues fell short of expectations as the company prepares for the legal battle against Elon Musk to enable the acquisition.
Twitter had a disappointing second quarter for 2022, lagging expectations in terms of revenue, revenue and user growth.
The social media company’s revenue for the period was $1.18 billion, a 1 percent year-over-year decline and well below analyst expectations of $1.32 billion. This marks the period in which Twitter is missing out on its largest revenue to date, CNBC reports.
Twitter said the revenue decline reflects “advertising industry headwinds” due to macroeconomic factors. Social media company Snap shared gloomy second quarter results this week and also blamed macroeconomic issues affecting ad sales.
Twitter said the revenue result was also due to “uncertainty” about the impending acquisition of Twitter by billionaire Elon Musk.
The social media platform reported a net loss of $270 million, which is a striking difference from net income of $66 million last year.
The company’s costs and expenses rose 31 percent this quarter to $1.52 billion. Twitter said the costs associated with the acquisition deal with Musk were about $33 million for this period.
Twitter’s earnable daily active users (mDAU) reached 237.8 million in the second quarter, up 16.6 percent from the same period last year and slightly below analyst expectations.
Uncertainty for Twitter
Speaking of the Twitter results, Forrestor VP and research director Mike Proulx said he is “in a sort of purgatory” and that the company’s future is “in question.”
“Twitter now has an acquirer who no longer wants it, a CEO and board of directors who want to get rid of it, and a workforce that is in the midst of it as their morale plummets.” said Proulx. “The real victim of all this drama is Twitter itself.”
Twitter said that due to its ongoing legal battle with Musk, it will not host a earnings conference call, issue a shareholder letter or provide financial guidance on the results.
Twitter’s lawsuit against Musk will be heard in October. This verdict was a win for Twitter as Musk’s legal team insisted the trial begin next year.
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Twitter logo at the headquarters in San Francisco. Image: Scott Beale / Smiling Squid via flickr (CC BY-NC-ND 2.0)
