STORY: Twitter reported a surprising fall in quarterly revenue on Friday, blaming a weak ad market and… Elon Musk.
The social media company is suing the Tesla founder for dropping his $44 billion offer to buy the company – and is now preparing for a legal showdown in a trial set to begin in October. Uncertainty around the deal has worried Twitter’s advertisers and caused chaos inside the company.
Advertising revenue rose just 2% to $1.08 billion, missing Wall Street's expectations of $1.22 billion, according to Refinitiv IBES data.
Total second-quarter revenue was $1.18 billion, compared with $1.19 billion a year earlier. Analysts were expecting $1.32 billion.
Monetizable daily active users, a metric closely watched by investors that measures users who see advertising on Twitter, grew 16% but fell short of analysts’ expectations by about a million users.
Inflation pressures and fears of a recession have forced some advertisers to slash their marketing budgets – which was also wreaking havoc on other social media companies on Friday.
Pinterest plunged more than 11%, Facebook-owner Meta dropped more than 5% and Google-owner Alphabet fell more than 3%.
At current prices Pinterest, Meta, Snap, Alphabet and Twitter were collectively set to lose about $42 billion in market value.