July 22 (UPI) — Twitter surprised Wall Street on Friday when it reported a loss of more than $200 million in the second quarter of 2022, a three-month period that saw billionaire Elon Musk agree to buy the social platform and then back out of the deal.
The social media giant’s earnings report showed a $270 million loss between April and June, a decline that saw Twitter stock decline 8 cents per share. The company also said revenue slid 1% to $1.18 billion, compared to Q2 in 2021.
The report said that during the quarter, however, daily Twitter users actually increased by almost 17% to 238 million.
The quarterly loss caught Wall Street by surprise, as most analysts expected the report would show a profit of 14 cents per share on $1.32 billion in revenue.
Twitter is presently suing Musk in a bid to force him to stick to his agreement to buy the platform for $44 billion. File Photo by Joe Marino-Bill Cantrell/UPI
Twitter cited multiple factors for the loss, including a decline in advertising revenue, “ongoing product improvements” and “global conversation” about Musk’s decision to walk away from buying the company.
Notably, the company said it would not provide an economic outlook or issue a letter to shareholders in the next quarter — which covers the July-October period — due to the uncertainty around the pending deal with Musk.
The Tesla and SpaceX CEO said he abandoned the Twitter deal because the company wouldn’t give him full figures on how many of its daily monetizable users are phony or “bot” accounts. Twitter has disputed that claim.
Twitter is presently suing Musk in a bid to force him to stick to the deal. The trial is scheduled for October and is expected to last for about five days.
At a court hearing this week, the judge sided with Twitter and said the trial should happen as soon as possible. Musk and his attorneys wanted to delay the proceeding. The judge said an unnecessary delay could harm Twitter’s value.