SAN FRANCISCO. For years, Twitter has been the number two social networking site. It never grew to the size and scope of Facebook or Instagram. It just got confused.
Then, Elon Musk, an experienced user of the service burst in. Have offered $44 billion to buy Twitter and stated that the company could have done much better if he had been in charge. He spoke disparagingly of Twitter executives, mocked their content policies, complained about the product, and confused more than 7,000 employees with his statements. As Mr. Musk reported on the company’s lack of business and financial prospects, Twitter’s stock fell more than 30 percent.
Now how Mr. Musk, the billionaire, is trying skip the blockbuster, he inexorably leaves Twitter worse off than it was when he said he would buy it. With every scathing tweet and public taunt, Mr. Musk damaged the social network’s credibility, damaged employee morale, scared potential advertisers, highlighted its financial difficulties, and spread misinformation about how Twitter works.
“His interaction with Twitter took a toll on the company,” said Jason Goldman, a member of the Twitter founding team who also served on the board of directors. “Employees, advertisers and the market as a whole cannot be condemned against a company whose path is unknown and which will now go to court to complete a deal with an unscrupulous actor.”
Dangerous situation highlights why Twitter sued Musk already this week to force the completion of the deal. The legal battle is likely to be protracted and extensive, including months of costly litigation and high-stakes negotiations involving elite lawyers. The decision is far from clear – Twitter can win, but if it loses, Mr. Black. Musk can leave by paying a breakup fee. Or both parties can reconsider or agree.
On Monday, the damage that Mr. Musk, 51, has done obvious damage. Twitter shares fell more than 11 percent to one of the lowest since 2020 as investors anticipated the upcoming legal battle. Since Twitter has adopted Mr. Musk’s April 25 acquisition bid saw his shares lose more than a third of their value. as investors increasingly doubt that the deal will be completed on the agreed terms. (In contrast, the Nasdaq Tech Index was down about 12.5 percent over the same period.)
Twitter declined to comment on Monday. AT letter Mr. Musk’s lawyers on Sunday, the company’s lawyers said his move to end the deal was “invalid and wrongful.” Musk “knowingly, willfully, willfully and materially violated” his agreement to buy the firm. Twitter will continue to provide information to Mr. Musk and work to close the deal, the letter added.
mr. Musk did not respond to requests for comment. Sunday the billionaire who called the number of fake accounts on the Twitter platform, as a reason why he cannot buy the company, tweeted a photo of him laughing at the situation.
Of all the wrecks, Mr. Musk is leaving Twitter, and the most notable of them may be how brutally he exposed the company’s deteriorating financial and business prospects. Twitter has operated at a loss for seven of its nine years as a public company. During the debate over Mr. Musk’s proposal did not generate much interest from other bidders, people with knowledge of the situation say. The Twitter board determined that Mr. Musk’s offer at $54.20 per share was the best he could get assuming he saw no way to reach that price on his own.
“Board uncertainty about the long-term future of the company will continue for employees, partners and shareholders, regardless of the outcome of the case with Elon,” he said. Goldman said.
Things have taken a turn for the worse for Twitter in recent months. Parag Agrawal, Twitter’s chief executive, said in a staff memo in May that the company had not met its business and financial goals. To address these issues, he fired product and revenue executives, introduced a hiring slowdown, and launched efforts to acquire new users and diversify into e-commerce. In April the company stopped providing forward-looking financial outlook for investors in anticipation of the acquisition.
That trajectory is unlikely to change as uncertainty about the deal puts advertisers, Twitter’s main source of revenue, in an uncomfortable position.
“In the near future, Twitter will have trouble reassuring shy advertisers and their users that they will be stable,” said Angelo Carusone, president of the Media Matters for America watchdog group.
In what was an implicit attack on Twitter’s senior management, Mr. Musk said he could work with the company much better. AT presentation to investors in May, he said he plans to quintuple the company’s revenue to $26.4 billion by 2028 and reach 931 million users in the same year, up from 217 million at the end of last year.
mr. Musk emphasized Twitter’s runaway financial direction. letter filed with the Securities and Exchange Commission on Friday. His lawyers wrote that the “deteriorating business and financial outlook for the company” has given him a breather, especially given Twitter’s recent “financial performance and revised guidance” for the upcoming fiscal year.
mr. Musk, who has over 100 million Twitter followers, also criticized the product, saying it’s not as attractive as other apps. He repeatedly stated without any evidence that Twitter is full of fake accounts, which was revealed; such accounts may be automated to pump out toxic or false content. (The company said less than 5 percent of accounts on its platform are fake.)
His taunts about fake accounts have weakened Twitter’s credibility as the company prepares to moderate heated political discussions about the upcoming elections in Brazil and this fall’s US midterms, disinformation experts say.
In another critique of Twitter and how it controls content, Mr. Musk vowed to end the company’s moderation policy in the name of free speech. In May, he said it will “lift former President Donald J. Trump’s permanent ban” on Twitter, allowing Mr. Trump to return to social media. This angered right-wing users, who have long accused the company of censoring them, and renewed questions about how Twitter should handle the debate about restrictions on free speech.
According to six current and former employees, employee morale was undermined within the company, leading to infighting and layoffs.
Some of those who stayed said they were relieved that Mr. Musk seemed to have decided not to own the company. Others shared nihilistic memes on company Slack or openly criticized To the board and executives of Twitter for entertaining Mr. Suggestion Musk in the first place, according to internal messages viewed by The New York Times. According to two people who are well aware of their thinking, there was a grim determination among the leaders.
Evan Williams, founder of Twitter, tweeted on Friday that he wants to put an end to Mr. Musk’s Antics.
“If I was still on the board, I would ask if we can just let this whole ugly episode end,” Williams wrote in response to an announcement that Twitter intends to sue Mr. Musk and force a deal. . “I hope this is the plan and this is the ceremony.”
Manu Kornet, Twitter employee, illustrated the mood with a cartoon of a broken company being thrown off the shelf by Mr. Wilson. Careless Elbow Mask. His signature: “If you break it, you buy it!”
Ryan Mack as well as Isabella Simonetti made a report.