After locking in a court date for its lawsuit against Elon Musk, Twitter has released a second quarter earning reports where the social media company repeatedly blames Musk’s botched acquisition as a cause of revenue loss. As the attempted purchase went from a done deal to Musk suddenly growing concerned about bots and attempting to back out, advertisers understandably had “uncertainty” about buying space on Twitter as the digital ad industry is experiencing problems of its own.
Via The Verge:
For the time being, though, the chaotic acquisition seems to be making it more difficult for Twitter to sell ads. Bloomberg previously reported that Twitter was trying its best to calm advertisers’ concerns about how Musk might change the platform, while Ad Age reported more recently that the drama has sent the company’s ad sales into “disarray.”
Interestingly, Twitter experienced user growth during the second quarter, but not because of Musk. The company cites “ongoing product improvements” for an increase in users.
Despite Musk causing a dip in ad sales, Twitter is still suing the Tesla CEO to complete the merger agreement at the agreed upon stock price. While Musk may be balking about the bot problem at Twitter, those concerns ring hollow considering Musk specifically cited bots as his reason for buying the platform in the first place. He boasted that he would not only fix the problem himself, but turn the platform into a free speech mecca. However, that was before Tesla’s share price started plummeting (possibly because of the acquisition) as did Twitter. Now, Musk might be forced by a Delaware court to complete the original deal, which in effect, means he’d be on the hook for buying Twitter at billions more than its worth.
(Via The Verge)