The incomplete takeover of Twitter by billionaire Elon Musk declines the ad revenue, uncertainty of acquisition impacts performance & affected the macroeconomics. Twitter makes it majority of its revenues from advertising.
Many social media platforms are free to use & help in connecting people, platforms as Twitter, Facebook, Instagram &, etc. Millions of active users use platforms for free without paying any service charge revenue for the social media platforms is earn by the ads that run on them. The ads are related to other organizations or company which takes help or uses the social media platforms to introduce their new product or promote their company by paying a certain amount for that particular advertisement on social media platforms.
Elon Musk made the offer of $44 billion for buying the social media platform named Twitter offer was twitted on the Twitter platform by Elon Musk himself. Twitter agrees to that offer. Later Musk refuses to acquire. After disclosing the offer, Musk said that Twitter has failed to provide certain information about the bots & fake accounts for which the company has not continued business.
According to analysts, Twitter’s revenue declined by 1% compared to the second quarter of the prior year & in the last quarter, revenue decline from $1.32 billion to $1.18 billion. Compared to past performance, the Wall Street analysts are expecting a growth in the revenue of Twitter of around 10%, instead of a decline of revenue by 1%. According to a Refinitiv survey analyst earning per share are expected of 14 cents instead of a loss of 8 cents per share.
Apart from the above macroeconomic challenges twitter has also gained or increased the number of active users compared to the last quarter. In number, Twitter has now 237.8 million daily active users increasing from 229 million active users last quarter. Twitter has also tried introducing a few subscription products in the past year to diversify its business from advertising revenue.
Analysts were expecting an increase in growth of the advertising marketin the upcoming months after the end of the pandemic occurred due to covid-19 which increased the inflation & import-export facility between nations across the world.