Twitter would have made more money in recent months if Elon Musk had not been in the picture. At least, that’s what the company says in its Q2 results release this morning, citing Musk as a factor in its revenue results, which fell year over year to $1.18 billion from $1.19 billion.
That’s not the only reason Twitter is experiencing revenue problems. The company also cites problems in the ad industry – see Snap’s poor performance yesterday – and the general economic environment. But “uncertainty regarding the impending acquisition of Twitter by an affiliate of Elon Musk” is the most Twitter-specific issue on the list.
Musk signed a deal to buy Twitter in April, and he’s been trying to get rid of it for several weeks since then. Finally, Musk filed with the Securities and Exchange Commission earlier this month in an effort to formally end the deal, and the two sides are now going to court in October. Twitter hopes Musk will go through with the acquisition, which would provide a premium over the company’s current share price.
For now, however, the chaotic takeover seems to make it more difficult for Twitter to sell ads. Bloomberg previously reported that Twitter was doing its best to allay advertisers’ concerns about how Musk might change the platform, while Advertising Age reported more recently that the drama has thrown the company’s ad sales into “disorder.”
That said, Twitter’s ad sales were still up 2 percent year over year, even when total revenues were lower. But the company needs to grow its ad sales revenue much faster. Twitter reported a net loss of $270 million, compared to a profit of $66 million in the year-ago quarter. The sales figure is a lot worse when we look at the growth trajectory. Last year around this time, Twitter’s revenue grew 74 percent year over year. Now it shrinks.
One thing Twitter will not do you give Musk credit? The user growth. The service reported reaching more than 237 million daily users, up from 229 million last quarter. That was, of course, due to “continuous product improvements.”