Twitter on Friday posted a surprise fall in revenue amid fierce competition from Apple and TikTok in a weakening advertising market, as the company wages a legal battle with Elon Musk over his $44 billion (roughly Rs. 3,37,465 crore) buyout deal.
The company reported second-quarter revenue of $1.18 billion (roughly Rs. 9,400 crore), compared with $1.19 billion (roughly Rs. 9,500 crore) a year earlier.
Analysts were expecting $1.32 billion (roughly Rs. 10,500 crore), according to Refinitiv IBES data.
Meanwhile, Facebook-owner Meta Platforms, Google-owner Alphabet and other companies that sell online ads lost about $80 billion (roughly Rs. 6,39,324 crore) in combined stock market value on Thursday after Snap posted poor quarterly results and warned of an uncertain outlook.
Slammed by a weakening economy, increased competition from TikTok and recent privacy changes on iPhones, the Snapchat owner missed second-quarter revenue targets and warned that “forward-looking visibility remains incredibly challenging.”
Its shares collapsed 26 percent, bringing Snap’s loss in 2022 to over 70 percent.
With Wall Street already worried about a potential recession, Snap’s report also sparked a selloff in rival internet ad sellers. Meta dropped 5 percent in extended trade, while Alphabet fell 3 percent and Pinterest tumbled 7 percent.
With Twitter suing Elon Musk to force the billionaire to make good on his April promise to buy Twitter for $44 billion (roughly Rs. 3,37,465 crore), many investors view Twitter’s stock as a wager on the outcome of that upcoming legal battle, and less as a reflection of the company’s current fundamentals.
© Thomson Reuters 2022