Twitter, which has had a busy month ended on Thursday, announced that it was scrapping its previous ambitious growth goals as it works towards a sale to Elon Musk.
Twitter announced first-quarter earnings, which generally met investor expectations. The company had $1.2 billion in sales—a 16% increase from a year ago—as daily users increased to 229 million, slightly more than Wall Street’s forecast for 227 million.
Twitter’s net income was $513 million, partly due to MoPub’s $970 million purchase.
In premarket trading, Twitter shares increased by 1.2% to $49.20. Musk has offered $54.20 a share for Twitter, and the unusually high spread between Twitter’s current price and Musk’s offer indicates some shareholders remain skeptical that the transaction will happen. Musk was approved by the board earlier in week. The next stage is to get shareholder approval.
Twitter was trying to reach the goals of Jack Dorsey, its cofounder and CEO before Parag Agrawal took over as CEO last November. This included reaching 315 million users and $7.5 billion in total revenue by the end of next year, targets that Wall Street said were already out of reach before Musk’s courtship started.
Musk has indicated he wants to rethink substantial portions of Twitter’s business, including its core ads unit that drives the majority of sales. He has also said he’d like the company to add encrypted messaging and reduce content-moderation policies to make Twitter “politically neutral,” a comment that won applause from conservatives and drew rebukes from researchers who say such changes could increase misinformation and harassment on the platform.
(Updating . . . )