Twitter has already spent $33 million in ELon Musk's bid to acquire the social media platform.
Elon Musk has expressed interest in acquiring the social media platform since April. Musk showed determinants in bidding for the platform despite the hold back of the company's board.
However, on July 8, the Tesla and SpaceX CEO filed to put a stop to his acquisition deal. With that, Twitter fought back by taking it to court, making sure Musk takes responsibility for his actions.
After the second quarter filing, the social media company reveals to be spending more in the weeks to come as their legal battle carries on.
Twitter's Q2 Earnings
Twitter has reported that it has spent over $33 million in costs from the pending acquisition from Musk in its second quarter earnings.
In April, Musk reached an agreement to purchase Twitter for $44 billion, but on July 8 he announced that he wants to back out of the deal.
According to Business Insider, Twitter is already incurring costs as a result of Elon Musk's legal battle with the social media giant. Due to the impending legal conflict with Musk, Twitter's expenses are only going to continue to increase.
Twitter has retained the services of one of the most prestigious law firms in the country, Wachtell, Lipton, Rosen & Katz LLP, to assist it in bringing a lawsuit against Musk with the intention of compelling him to fulfill the terms of the original agreement and purchase the company.
Wachtell, Lipton, Rosen & Katz LLP focuses on merger litigation and has connections to the state's judicial system.
On the contrary, the law firm Quinn Emanuel Urquhart & Sullivan LLP will be representing Musk in this matter. Back in 2019, the law firm was able to defend the billionaire against defamation charges and come out on top.
The attorneys for Twitter have asserted that Musk's purported concern over fake accounts is nothing more than a smoke screen, and that the real reason he wants out of the deal is because the value of his Tesla shares has plummeted.
According to CNBC, Wall Street had anticipated a revenue of $1.32 billion, which would have represented an increase of 10.5% year over year. These results represented Twitter's largest revenue miss in the company's history. Unfortunately, the social media platform came in 11 percent below estimates.
Twitter stated that the uncertainty surrounding the pending acquisition by Elon Musk was one of the factors that contributed to the decline in revenue, along with headwinds in the advertising industry that were linked to a more challenging macroeconomic environment.
Twitter Acquisition
As previously reported in iTechpost, Twitter's first hearing took place on July 19, set by the chancellor of the Delaware Court of Chancery, Kathaleen McCormick.
Twitter's lawsuit against Musk was granted an expedited trial so that the "business risk" to the company could be reduced as quickly as possible. Twitter felt positive with the court's approval.
The social media company stated that Musk unlawfully breached his agreement to acquire the company.
In Twitter's lawsuit filing, "Twitter brings this action to enjoin Musk from further breaches; to compel Musk to fulfill his legal obligations; and to compel consummation of the merger upon satisfaction of the few outstanding conditions."
Before his bid to cancel the acquisition, due to Musk's tweets, it seems like the deal has been halted because the social company failed to address the number of how many bots and spam are on the platform.
In addition, he believes that the company is withholding important information in order to guarantee that the acquisition will be successful.
