LONDON ( Associated Press) – Twitter’s quarterly profit, revenue and the number of daily users on its platform are rising, but its quarterly report, released just days after it agreed to be sold to billionaire Elon Musk, has been about it on the financial front. Very little detail is given in the rest of the year.
The social media company reported net income of $513 million, or 61 cents per share, on Thursday, but that includes a large one-time gain from the sale of its MoPub business, compared with the year-ago period.
Revenue from ads rose 16% to $1.2 billion in the three months to March compared to the same period last year, though the company said the figure reflects “headwinds associated with the war in Ukraine” without elaborating.
Twitter reported an average of 229 million daily active users in the quarter, up nearly 14 million compared to a revised 214.7 million daily users in the previous quarter.
The San Francisco company canceled a conference call with executives and industry analysts that usually accompanies its results, so it’ll have a little more insight into the company’s current financial situation.
“Given the pending acquisition of Twitter by Elon Musk, we will not provide any forward-looking guidance, and are retracting all previously provided targets and perspectives,” the company said.
Musk, which is paying $54.20 for each outstanding share of Twitter, did not speak publicly on the quarterly report, perhaps in its last report as a publicly traded entity.
Musk’s $44 billion deal Buy Twitter was announced earlier this week and is expected to close sometime this year, But before the deal is complete, shareholders will have to weigh in on regulators in the US and the countries where Twitter does business. So far, though, some odds are expected, despite objections from Twitter’s own employees as well as users who worry about Musk’s stance on free speech and what it might mean for harassment and hate speech. could on the platform.
CFRA technical analyst Angelo Zino said the results, along with the many challenges facing the digital advertising industry, should strengthen the board’s decision to approve Musk’s proposal.
“We see no reason to believe that Twitter can extract greater shareholder value publicly,” he said in a research note.
Still, Twitter’s shares have yet to reach a buy price, and the company’s stock rose slightly to $49.11 on Thursday.
The difference between the deal price and the current stock price indicates that some investors are unsure of when and whether the deal will be completed, said former CEO and president of Baxter International, Harry Kramer, who is now at Northwestern University’s Kellogg School. I am Professor. of management.
One factor in the uncertainty is how unusual it is for an individual to buy a multibillion-dollar company.
In the case of a second takeover of a publicly traded company, investors can check the buyer’s financial disclosures and see if they have the cash to fund the deal. The buyer can also issue shares to raise funds, if required.
“But in this case, Tesla isn’t buying the company, Elon Musk is,” Kramer said. “Elon Musk is a person. You can’t look at the balance sheet and see where the cash is coming from.
Another factor is Musk’s tendency to change his mind, fearing he could back out of the deal, even if he has to pay a $1 billion break-up fee.
Musk, who runs electric car company Tesla as well as SpaceX and other ventures, says he plans to make Twitter private. If it does, the company will no longer turn to shareholders or publicly report its financial results, which are at best mixed since the company went public in 2013.
Twitter has consistently struggled to post profits as a public company while generating weaker revenue growth than the two major forces in digital advertising, Google. and facebook,
On one hand, going private could give Twitter more room to experiment, while focusing less on short-term gains and its share price. On the other hand, even the richest man in the world wants the company to make money.
John Mayer, a technology entrepreneur and investor, told the Associated Press, “I think there’s nothing better for Twitter than buying it and ideally replacing the board and doubling down on the investment in products and new revenue-generating sources.” ” This week.