The past months have been a rollercoaster ride for Twitter as they continue to follow the thrilling story of Elon Musk’s attempt to buy the company.
In May, the Federal Trade Commission made noises about it being considering an investigation into the possible deal Elon Musk might make to purchase the company. Twitter also was rocked by an undercover investigation by Project Veritas, showing the fearful reactions of the tech firm’s woke employees about the prospect of Musk taking over.
Then in June, we reported on Twitter breaking progressive hearts by re-engaging Musk in the deal, after it seemed the progress wasn’t going as scheduled. around the middle of the month, the company’s board of directors officially put their stamp of approval on Musk gaining ownership.
As many of you know, Musk pulled out of his contract negotiations earlier in July. Twitter, a social media platform, filed suit against Musk and his CEO, Tesla, for violating a contract 10 days ago.
Twitter received both positive and negative news about the lawsuit this week. Let’s start with the good news. Deadline reported that the judge gave the positive verdict to the company Tuesday.
Delaware Chancery Court Judge Kathaleen McCormick has set a five-day trial in October for Twitter’s lawsuit against Elon Musk. The company had asked for an expedited four-day trial in September, while Musk’s attorneys wanted a late February date.
The ruling at today’s hearing favored Twitter as the judge agreed with its arguments that a delay can cause its business, and that of any public company, irreparable harm. Andrew Rossman representing the Musk camp said she disagreed that a fall case was unfeasible in a short timeframe for all involved. “In my view, the defendants underestimate the ability of the court,” she said after hearing arguments for both sides.
But the bad news, which came Friday, is that the delay and “uncertainty” over the unfinished deal with Musk may already be hurting Twitter’s bottom line.
Deadline:
Twitter swung to a loss in the June quarter and missed Wall Street’s revenue forecast, blaming ad-industry headwinds and uncertainty surrounding its acquisition by Elon Musk.
From a $66million profit in the previous year, it plunged to $270 million. The revenue of $1.18billion was down by 1% over the previous year (or up by 2% if you exclude foreign currency fluctuations).
Twitter shares have fallen 1.7%
The publication added that “Twitter clocked 237.8 million MAUs, or monetizable daily active users, up 17% from last year’s quarter but lower than anticipated all as the company prepares to enter the ring with Elon Musk.”
In a statement, Twitter revealed they aren’t holding an earnings call or sending a letter to shareholders.
“Given the pending acquisition of Twitter by an affiliate of Elon Musk, we will not host an earnings conference call, issue a shareholder letter, or provide financial guidance in conjunction with our second quarter 2022 earnings release,” said Twitter, so there won’t be any color around that. The boilerplate information on the dispute was included.
It’s pretty obvious why they would want to avoid such things right about now.
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