Twitter cites Elon Musk and the economy as Q2 numbers fall short – Deadline

Twitter posted a loss in the June quarter and revenue came in below Wall Street’s forecasts, blaming ad industry headwinds and uncertainty related to the pending acquisition of Twitter by a subsidiary of Elon Musk.

It moved to a loss of $270 million from a profit of $66 million the year before. Revenue of $1.18 billion decreased 1% year over year (or increased 2% on a constant current basis excluding currency fluctuations).

Twitter shares are down 1.7%. He reported after Snap, whose shares are plummeting after yesterday afternoon’s disappointing quarterly numbers that raised huge red flags for the digital ad business amid high inflation, rising interest rates and the war in Europe.

As Snap explained on Wednesday, advertising budgets are among the outlays companies must cut under pressure. Their participation has dropped by 33%. Wall Street is bracing for a string of tech gains next week.

Twitter recorded 237.8 million MAUs, or monetizable daily active users, up 17% from last year’s quarter but less than anticipated, all as the company prepares to enter the ring with Elon Musk.

The June quarter figures come two days after a judge set October for a five-day trial period in a lawsuit the social media platform filed against the billionaire founder of Tesla, who took a large stake in Twitter and agreed to bought it last spring, but unilaterally terminated the deal earlier this month.

“Given the pending acquisition of Twitter by an affiliate of Elon Musk, we will not hold an earnings conference call, issue a shareholder letter, or provide financial guidance in conjunction with our Q2 2022 earnings report,” Twitter said, per so there won’t be any color around that. It included some repetitive history in dispute.

“As announced on April 25, 2022, we have entered into a merger agreement, pursuant to which Twitter has agreed to be acquired by an entity wholly owned by Elon Musk, for $54.20 per share in cash. At the end of the
transaction, Twitter will become a private company.

On July 8, 2022, Mr. Musk’s representatives delivered a notice that he intended to terminate the merger agreement. Twitter believes that the alleged firing of Mr. Musk is invalid and unfair, and the merger agreement remains in place.

On July 12, 2022, Twitter initiated litigation against Mr. Musk and certain of his affiliates to compel them to specifically perform their obligations under the merger agreement and consummate the closing in
in accordance with the terms of the merger agreement.

On July 19, 2022, Twitter’s request for an expedited trial was
granted, and trial is scheduled for October 2022.”

Adoption of the merger agreement by our shareholders is the only remaining regulatory approval or condition to complete the merger under the merger agreement. The exact timing of the completion of the merger, in any event, cannot be predicted because the merger is subject to ongoing litigation, the adoption of the merger agreement by our shareholders and the satisfaction of the remaining closing conditions.

The court’s ruling for a trial in October—the company had asked for September—was a victory. Musk’s camp was expecting a delay until February at the Delaware Chancery Court. The judge agreed with Twitter that prolonged uncertainty risks irreparably damaging the company’s business.

Twitter’s operating loss was $344 million, representing a 29% decrease in operating margin, compared to operating income of $30 million, or an operating margin of 3% in the same period last year.

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