Although the number of Twitter users was high, the company’s financial results fell short of expectations. Some analysts have speculated that Twitter’s board wanted to seal the sale to Musk before posting weak profits. The social networking company reported revenue for the first quarter of $ 1.2 billion – up 16 percent from last year, but less than the $ 1.23 billion expected by Wall Street analysts. Costs and expenses totaled $ 1.33 billion, up 35 percent from last year, resulting in operating loss of $ 128 million. However, the San Francisco-based Twitter reported an average of 229 million daily active users in the quarter, up 16% from last year as a positive sign. Twitter posted one of its last quarterly earnings reports on Thursday, just days after agreeing to sell to billionaire Elon Musk Although Twitter users’ numbers have risen, the company’s financial results have fallen short of expectations Musk’s $ 44 billion deal to buy Twitter was announced earlier this week and the deal is expected to close later this year. Twitter canceled the video conference with executives and analysts of the industry that usually accompanies its results, so there will be no further picture of the current financial situation of the company. “Given the pending acquisition of Twitter by Elon Musk, we will not provide any future guidance and withdraw all previously set goals and prospects,” the company said in a statement. Shares of Twitter rose less than 1 percent in pre-market trading to $ 48.81. Musk has agreed to buy the company for $ 54.20 a share, and the stock price is currently dictated by investor views on how likely the deal is to close. The earnings results show Musk’s challenges in improving the business platform of the social media platform to match its influence on news and culture. Twitter has long been criticized for the slow release of its products. Musk has tweeted suggestions ranging from the release of a high-demand edit button to the creation of the open source Twitter algorithm. When Musk closes the deal, he will oversee a company that has long-running battles with internal dysfunction, indecision and lack of accountability, Reuters reported earlier, according to eight current and former Twitter employees. Daily active Twitter users rose to 229 million in the first quarter ended March 31, from 199 million a year earlier. The number exceeded analysts’ expectations for 226.8 million active users daily. Facebook owner Meta Platforms also reported a return to increase in users on Wednesday, which helped boost social media shares. Twitter said an internal error resulted in the company overestimating quarterly user numbers by about 1.5 million between the fourth quarter of 2020 and the end of 2021. The company said it also overestimated the data in 2019, but was not able to provide data. Given the pending acquisition, Twitter said it would provide no future guidance and withdraw all previous goals and prospects. The company announced last year that it aimed to double its annual revenue and increase its 315 million users by 2023, as former CEO Jack Dorsey aimed to signal a return to years of product stagnation. Total revenue for the first quarter was $ 1.2 billion, compared with analysts’ average estimate of $ 1.23 billion, according to IBES data from Refinitiv. The share price of Twitter is shown from the beginning of the year. Musk plans to pay $ 54.20 a share to acquire the company and make it public sometime this year The company earns most of its revenue from the sale of digital ads on the site and the application. Twitter cut off ads in Ukraine and Russia in February amid a continuing invasion, which the Kremlin calls a “special military operation.” “The macroeconomic environment is becoming hostile as advertisers cut back on spending as they face inflation, which is at a four-decade high,” said Haris Anwar, a senior analyst at Investing.com. Musk said Twitter should not serve ads, which would allow the platform to have more control over its content policies. Advertisers generally prefer strong content monitoring to prevent their brand from appearing next to inappropriate content. Its net profit rose to $ 513.3 million, or 61 cents a share, from $ 68 million, 8 cents a share, a year earlier.
Developing history, more to follow.
