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Twitter targets Musk deal for poor results | business news

Twitter has missed expected earnings, attributing disappointing financial results in part to Elon Musk’s botched takeover of the social media network.

The richest man in the world said he was get out of a deal this month to buy the tech company for $44bn (£36.6bn) and the company is suing him to force him to fulfill his earlier promise in April to acquire it.

A showdown court date is set for October with an £830million termination bill for Mr Musk at stake.

Twitter pushed for a September hearing of the court case as the ongoing dispute is hurting its business.

In its second-quarter financial results, Twitter said that “uncertainty” surrounding the deal led to a surprise drop in revenue after unsettling advertisers and sparking confusion and concern among employees.

The social network also blamed headwinds in the advertising industry for the slowdown.

The company said it had already spent £27m on the takeover attempt, at a time when Twitter was reporting a £224m net loss, less than expected.

Analysts had been expecting revenue of $1.32 billion, up 10.5% year over year.

Instead, Twitter’s revenue fell 1%, marking the company’s worst revenue loss on record, with results coming in 11% below estimates, according to data from Refinitiv.

Meanwhile, Twitter’s daily users rose to 237 million in the second quarter.

Mr Musk, the head of Tesla and SpaceX, had promised to pay $54.20 a share for Twitter but told the company in July he wanted to back out of the agreement.

“It’s an attempt at sabotage. He’s doing his best to shut down Twitter,” said William Savitt, an attorney for the social media company.

The tycoon claims the company didn’t give him enough information about the number of fake – spam bot – Twitter accounts.

And he says it has breached its commitments by firing top executives and laying off a significant number of workers.

Musk’s team expects more information about the bot numbers to come out in court investigations when both sides have to present evidence.

Twitter argues that Musk is trying to pull out because he agreed to pay 38% above Twitter’s share price just before the stock market fell.

And shares in electric-car maker Tesla, where most of his personal wealth resides, lost more than $100 billion in value.

Twitter targets Musk deal for poor results | business news

Source link Twitter targets Musk deal for poor results | business news

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