It reduced spending on contractors and consultants. Twitter has sought to adjust to the deteriorating business conditions by also pausing hiring. Facebook’s parent, Meta Platforms ( META), also posted its first-ever decline in revenue.Ĭompanies that rely heavily on digital advertising for sales have been particularly hard hit by the economic downturn. The company’s Chief Executive Officer (CEO) Evan Spiegel has already said they would halt the development of the drone project Pixy. The Wall Street Journal (WSJ) reports that Snap ( SNAP) will reduce its hiring pace after posting the weakest-ever quarterly sales growth. Twitter is not the first company to cut costs in response to harsh economic times. The figure is expected to fluctuate even further throughout the year, depending on the company’s earnings. The bonus pool has already shrunk to 50% of what it could be if the company met its financial targets. Twitter’s Chief Financial Officer (CFO), Ned Segal, says the challenges look set to affect annual bonuses. Musk is trying to pull out of the deal while Twitter has sued to force an acquisition. In addition, the New York Times reports that the stalemate over the protracted $44 billion takeover by Elon Musk has generated some uncertainty. Challenges Affecting Twitter’s PerformanceĪdvertisers who account for the biggest share of Twitter’s revenue have reduced spending owing to economic fears. In Q2 2022, Twitter reported a decline in revenue for the first time since 2020. The potential bonus cut is due to deteriorating financial performance. The New York Times ( NYT) reports that the company has warned employees they will receive only half of their typical annual bonuses.
"By delaying his disclosure of his stake in Twitter, Musk engaged in market manipulation and bought Twitter stock at an artificially low price," the lawsuit says.Twitter ( TWTR) is facing serious financial challenges amid harsh economic conditions that are affecting its core advertising business. Musk benefited by more than $156 million US from his failure to disclose his increased stake on time, since Twitter's stock price could have been higher had investors known Musk was increasing his holdings, the lawsuit claims. But the lawsuit says Musk did not disclose the stake within the timeframe required by the Securities and Exchange Commission.Īnd the lawsuit says his eventual disclosure of the stake to the SEC was "false and misleading" because he used a form meant for "passive investors" - which Musk at the time was not, because he had been offered a position on Twitter's board and was interested in buying the company. Elon Musk and Twitter agree to pay $1B break fee if takeover deal falls apartīefore announcing his bid to buy Twitter, Musk disclosed in early April that he had bought a nine per cent stake in the company.Elon Musk says he will reverse Twitter's ban on Donald Trump.Twitter's shares closed Thursday at $39.54, 27 per cent below Musk's $54.20 offer price. "In doing so, Musk hoped to drive down Twitter's stock price and then use that as a pretext to attempt to re-negotiate the buyout," according to the lawsuit.
In response to the plunging value of Tesla's shares, the Twitter shareholders' lawsuit claims Musk has been denigrating Twitter, violating both the non-disparagement and non-disclosure clauses of his contract with the company. To fund some of the acquisition, Musk has been selling Tesla stock and shares in the electric carmaker have lost nearly a third of their value since the deal was announced on April 25. Twitter has also disclosed its bot estimates to the Securities and Exchange Commission for years, while also cautioning that its estimate might be too low. The company paid $809.5 million last year to settle claims it was overstating its growth rate and monthly user figures. In addition, the problem of bots and fake accounts on Twitter is nothing new. Duration 4:09 Elon Musk says his planned $44 billion US purchase of Twitter is 'temporarily on hold' pending details on spam and fake accounts on the social media platform, but he is 'still committed to acquisition.'
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