Twitter said Thursday that customer growth is picking up amid weak revenue in what is expected to be one of its final earnings reports as a publicly traded company before billionaire Elon Musk takes the social media company private.
Twitter's customer base became a dynamic customer monetized daily - the company's primary reporting metric - by 16% to 229 million during the quarter ended March 31 - a period that ended just days before Musk revealed his 9% stake in the company.
This view continued Musk's work to buy the entire company with a plan to do away with its content modification policies.
However, Twitter did not live up to Wall Street's forecast for first-quarter revenue, coming in at $1.2 billion versus the $1.23 billion that investigators had expected. The company attributed the shortage in part to "headwinds related to the war in Ukraine".
The 16% expansion in quarterly revenue represented the slowest pace of growth for Twitter in more than a year, according to Bloomberg.
The social media platform has canceled its scheduled phone call with experts to check the results - a decision company officials described as "familiar during the acquisition period."
Twitter's board approved Musk's $44 billion takeover offer last week in a deal expected to close later this year. Each side agreed to pay $1 billion in the event of a breakup if the deal failed under specific circumstances — such as Musk losing funding for the show or Twitter accepting another unsolicited offer from a third party.
"The transaction is subject to the usual closing conditions, completion of regulatory review and approval of Twitter shareholders," Twitter said in an official statement. "The deal, which is expected to expire in 2022, has been approved by Twitter's board of directors."
Twitter declined to provide guidance on its upcoming cash results and retracted its earlier guesses, citing Musk's pending acquisition of the company.
The shares were flat in pre-market trading after posting their earnings. The organization's stock closed at $48.64 on Wednesday, less than Musk's purchase price of $54.20 a share.
Additionally, the company reported diluted earnings per share of 61 cents - although it noted that the result was not comparable to the same period a year ago due to its sale of mobile advertising platform MoPub.
Musk has outlined a series of changes he hopes to implement on Twitter once the deal closes — including plans to remove automated bots from the platform, authenticate all users and make the Twitter algorithm open source to enhance transparency.
However, Musk's way of seeing is to undo Twitter's strict content moderation policies. Musk's plan has alarmed some incumbent Twitter employees and left-leaning critics, who fear that the billionaire's focus on absolute freedom of speech will lead to more abusive or harmful content.
Musk clarified his stance on Twitter's policies toward free speech on Tuesday.
"By 'freedom of speech' I mean only what complies with the law. I am against censorship that overrides the law. If the people want less freedom of speech, they will ask the government to make laws for that purpose. Therefore, bypassing the law goes against the will of the people."