The social media company was runner-up for a long time. It didn't grow to the size of a social network. It didn't really move along.
The power user of the service, Musk, came in. If he were in charge, he said that the company could perform better. He criticized the product and confused its more than 7,000 employees with his statements. The company's stock plunged more than 30 percent as Mr. Musk revealed the company's lack of business.
When Mr. Musk said he would buy it, he left it worse off than it is now. Mr. Musk has eroded trust in the company, walloped employees, spooked potential advertisers, and spread misinformation about how the company operates.
He was a member of the founding team of the company and served on its board. It's not possible for employees, advertisers and the market at large to have conviction in a company that will go to court to complete a transaction with a bad-faith actor.
The precarious situation shows why Mr. Musk is going to be sued by Twitter. It will take months of expensive litigation and high-stakes negotiations to resolve the court battle. If it loses, Mr. Musk could walk away and pay a fee. The two sides could try to work something out.
The damage done by Mr. Musk was obvious on Monday. The stock fell to its lowest point in more than a year as investors anticipated the legal battle. Since Mr. Musk's acquisition offer was accepted, the company's stock has lost over a third of its value. The tech-laden Nasdaq index was down about 12 percent in the same time period.
On Monday, there was no comment from the social networking site. The company's lawyers said in a letter to Mr. Musk's lawyers that his move to end the deal was "invalid and wrongful." The letter said that the company would continue to give information to Mr. Musk.
Mr. Musk did not reply to questions. On Sunday, the billionaire, who has cited the number of fake accounts as the reason that he cannot buy the company, posted a picture of himself laughing.
Mr. Musk exposed the company's declining financial and business prospects in a brutal manner. The company has lost money for seven of the nine years it has been a publicly traded company. People with knowledge of the situation say that the company received no serious interest from other potential buyers. It was decided by the board that Mr. Musk's offer of $54.20 a share was the best one it could get.
Mr. Goldman said that the board's lack of conviction in the company's long-term future will linger over employees, partners and shareholders no matter what happens.
In the last few months, there has been a decline in the company's business. In a memo to employees in May, the company's chief executive said that the company hadn't lived up to its goals. In order to address the issues, he pushed out the heads of product and revenue and instituted a hiring slowdown. The company stopped giving a financial outlook to investors in April.
Advertisers are the main source of revenue for the company.
The president of the watchdog group Media Matters for America said thatTwitter will have trouble in the near future reassuring advertisers that they are going to be stable.
He said he could have done better with the company. In a presentation to investors in May, he said he planned to triple the company's revenue to $26.4 billion and to have over one billion users by the year 2000.
In a letter to the SEC on Friday, Mr. Musk emphasized the financial direction of the company. His lawyers wrote that he had paused because of the company's declining business prospects and financial outlook.
The product was jackhammered by Mr. Musk, who said it was not as attractive as other apps. He has claimed for a long time that there is more inauthentic accounts on the platform than the company has acknowledged. Less than 5 percent of accounts on the platform are fake, according to the company.
As the company prepares to moderate heated political discussions about an upcoming election in Brazil and the upcoming elections in the US, misinformation experts say his barbs about fake accounts have weakened trust in the service.
Mr. Musk said he would end the company's moderation policies in order to protect free speech. He said he would allow Mr. Trump to return to the social network. Right-wing users have long accused the company of censoring them, and that renewed questions about how to handle debates over the limits of free speech.
According to six current and former employees, the company's infighting and attrition is the result of a battered employee culture.
Some of the remaining people said they were relieved that Mr. Musk didn't own the company. The New York Times viewed internal messages that criticized the board and executives for entertaining Mr. Musk. Two people with knowledge of their thinking said that the executives were gloomy.
Evan Williams wished for an end to Mr. Musk's shenanigans.
If I was still on the board, I would be asking if we could just let this whole ugly episode blow over, said Mr. Williams. This is a ceremony, hopefully that is the plan.
The cartoon showed a shattered company that had been bumped off a shelf by Mr Musk. You buy it if you break it.
Ryan Mac reported.
All Rights Reserved © 2024
