Twitter disappoints in Q2 discussing impact of Musk case

Published: 22.07.2022 – 14:38Modified: 22.07.2022 – 14:36

New York (AFP) – Twitter recorded results in the second quarter that were well below expectations, which the social network said was a disappointment due to the unfavorable context, in particular the uncertainty surrounding its potential takeover by Elon Musk.

According to a press release published on Friday, the turnover of the group, which is trying to force the entrepreneur to fulfill its obligations in court, fell (-1%) to $1.18 billion over the year.

This decline is attributed to “headwinds” in the advertising sector, concerns affecting the economic situation, as well as “uncertainty associated with the ongoing acquisition of Twitter” by Elon Musk.

The number of so-called “monetizable” daily active users, i.e. those who may be exposed to advertising on the platform, increased by 8.8 million, less than analysts had expected, to 237.8 million.

With credit tightening and the economic downturn, companies based entirely on advertising are suffering from shrinking advertising budgets.

So on Thursday, Snap opened up the social media ball and reported a larger loss than expected and lower than expected turnover, giving it a loss of over 30% on the pre-Sotck exchanges on Friday.

Shadow Mask

In addition to the unfavorable economic situation for the entire sector, Twitter is also weakened by the saga of its hypothetical takeover by Elon Musk.

After the contractor’s refusal, in early July, the case moved to a legal basis, where the leaders intend to ensure that the billionaire is forced to acquire Twitter.

Elon Musk, February 10, 2022 in Boca Chica, Texas, during the presentation of the SpaceX Starship mega-rocket. JIM WATSON AFP/Archive

On Tuesday, a special court judge in Delaware (Northeast) ordered a tense trial over five days in October.

Thus, the magistrate granted the request of Twitter, which called for an accelerated procedure to limit the damage from this saga to the group, and rejected, on the other hand, the arguments of Elon Musk’s lawyers that the debate would not be open until 2023. .

The businessman accuses Twitter executives of lying about the share of automated accounts and spam on the platform and of not providing him with enough data to verify.

The Blue Bird group disputes these claims and accuses Elon Musk of using them as a distraction.

Many investors believe that Twitter has regained control, allowing its stock price to recover.

It is now at the same level as on the eve of the announcement, on April 4, of Elon Musk’s share in the capital, which is the first step before submitting an offer for the entire company ten days later.

After the release of quarterly results, the title still fell more than 2% in electronic trading before the opening of the New York Stock Exchange.

As with the Q1 release, Twitter did not host a traditional conference call on Friday to present the results.

In the second quarter, the group posted a loss of $270 million, while it made a profit in the same period of 2021.

On a per-share basis, data scrutinized by investors shows the net loss is nearly three times analysts’ expectations.

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