San Francisco (TIP)- Twitter on Thursday, April 28,  posted quarterly earnings of $513 million days after it agreed to be sold to billionaire Elon Musk. The social media company said Thursday that revenue rose 16% to $1.2 billion in the three months to March compared with the same period last year. Twitter, based in San Francisco, reported an average of 229 million daily active users in the quarter, up 16% from last year. Musk’s $44 billion deal to buy Twitter was announced earlier this week and the deal is expected to close later this year.

Twitter cancelled the conference call with executives and industry analysts that usually accompanies its results, so there will be little further insight into the company’s current financial condition.

Musk’s purchase of Twitter is expected to close sometime this year. But before the deal is completed, shareholders will have to weigh in, as well as regulators in the US and in countries where Twitter does business. So far though, few hurdles are expected, despite objections from some of Twitter’s own employees, along with users who worry about Musk’s stance on free speech and what it might mean for harassment and hate speech on the platform.

Musk, who also runs the electric car company Tesla, as well as SpaceX and other ventures, says he plans to take Twitter private. If he does, the company will no longer be beholden to shareholders or publicly report its financial results, which have been mixed at best since the company went public in 2013.

Twitter has struggled to consistently post profits as a public company while generating lackluster revenue growth compared to the two dominant forces in digital advertising, Google and Facebook.

On one hand, going private could give Twitter more room to experiment while focusing less on short-term profit and its stock price. On the other hand, even the world’s richest man is likely to want the company to make money.

“I think there is nothing better for Twitter than Elon Musk buying it and ideally replacing the board, and also doubling down on investments into products and new revenue-generating sources,” John Meyer, a technology entrepreneur and investor, told AP. Musk told banks he will rein in Twitter pay, make money from tweets: Sources

SAN FRANCISCO: Elon Musk told banks that agreed to help fund his $44 billion acquisition of Twitter Inc that he could crack down on executive and board pay at the social media company in a push to slash costs, and would develop new ways to monetize tweets, three people familiar with the matter said.

Musk made the pitch to the lenders as he tried to secure debt for the buyout days after submitting his offer to Twitter on April 14, the sources said. His submission of bank commitments on April 21 were key to Twitter’s board accepting his “best and final” offer. Musk had to convince the banks that Twitter produced enough cash flow to service the debt he sought. In the end, he clinched $13 billion in loans secured against Twitter and a $12.5 billion margin loan tied to his Tesla stock. He agreed to pay for the remainder of the consideration with his own cash.

Musk’s pitch to the banks constituted his vision rather than firm commitments, the sources said, and the exact cost cuts he will pursue once he owns Twitter remain unclear. The plan he outlined to banks was thin on detail, the sources added. Musk has tweeted about eliminating the salaries of Twitter’s board directors, which he said could result in about $3 million in cost savings. Twitter’s stock-based compensation for the 12 months ending Dec. 31, 2021 was $630 million, a 33% increase from 2020, corporate filings show.

Source: AP and Reuters