Social media giant Twitter reported a $270 million loss for the second quarter of the year blaming the current uncertainty around its proposed takeover by Elon Musk and advert declines.
According to the report, its Q2 revenue totaled $1.18 billion, which is a 1% decrease in the year-over-year metrics. Its share price dropped by 35 cents when compared with 2021 when the loss was just 7 cents per share and it had a profit of $66 million.
The declined revenue also failed to meet the average targets of analysts who expected the firm to earn around $1.32 billion during the period.
The social media company revealed that its daily active users spiked from 229 million in the first quarter to 237.8 million.
However, the number pales significantly against social media rivals like Meta-owned Facebook and Instagram, or even the fast-growing video-sharing platform TikTok.
Twitter and Elon Musk
Elon Musk had proposed to purchase Twitter for an outright fee of $44 billion which amounted to $54.20 per share earlier in the year.
The richest man in the world backed out of the deal on July 8 over claims that the social media site had breached provisions of the merger agreement. Musk and Twitter publicly disagreed over the number of bot accounts on the platform.
Twitter claims bots accounts are less than 5% but Musk disagrees.
Twitter has however commenced litigation processes against Musk on July 12. The trial is scheduled for October, but Musk’s lawyers are seeking to delay it.
The earnings report revealed that the firm had spent $33 million on the acquisition.
Twitter’s shares performance had briefly sparkled when reports of Musk’s proposed acquisition emerged.
But the surge was short-lived as Musk began to raise concerns over fake accounts and bots users on the platform.
As of press time, Twitter’s share had reacted negatively to news of this earning report as it dropped by 2% to about $38.50.