Twitter's most valuable users are ghosting the platform
Fly, little birds: Damning internal research emerges just before Elon Musk buy
With just days to go before Elon Musk closes his acquisition of Twitter, internal research has revealed an exodus of the social media platform's most valuable users.
Earlier this week, Musk said he would complete the buyout by Friday, October 28, a court-ordered deadline, during a video conference call with bankers helping to finance the $44 billion deal, according to Bloomberg.
Wall Street lenders are said to be finalizing $13 billion of debt financing, with the largest chunk coming from Morgan Stanley, which is still doing due diligence before sending Musk the cash. Twitter stock traded as high as $53.18 at the news – not quite Musk's $54.20-a-share price.
The transaction puts the banks in a shaky position, even if they are primed to handle the shock. Under normal conditions, they would pass debt commitments to money managers through junk bonds and leveraged loans ahead of a deal's closure, but with days left and poor global credit conditions, the banks face losses of around $500 million.
Musk promised on the call to help market the debt, and his original commitment letter said his team would assist for up to 30 days after the deal's closure, with Musk participating in any investor meetings for up to two hours.
Where did the tweeters go?
It's not a great time for anyone, let alone the world's richest man, to be borrowing vast amounts of money amid soaring interest rates, inflation, recession fears, and multiple geopolitical crises. Yet documents from inside Twitter itself may only serve to stoke that sense of buyer's regret in Musk's camp.
- Elon Musk reportedly wants to gut Twitter workforce by up to 75%
- Musk grumbles about 'overpaying' for Twitter but says he's excited
- Er, Musk's trial hasn't stopped, no matter what he told Twitter, says judge
- Elon Musk tells Twitter: My takeover deal is back on
Internal research seen by Reuters says that "heavy tweeters" – defined as someone who logs in to Twitter six or seven days a week and tweets about three to four times a week – have been in "absolute decline" since the start of the pandemic.
This matters because, although these whales account for "less than 10 percent" of monthly overall users, they generate "90 percent of all tweets and half of global revenue." For context, the document is titled "Where did the Tweeters Go?"
The study also highlighted a shift in interests among the website's English-speaking heavy users from news, sports, and entertainment to cryptocurrency and NSFW content – stuff advertisers do not usually wish to associate with their brands.
A Twitter spokesperson said of the findings: "We regularly conduct research on a wide variety of trends, which evolve based on what's happening in the world. Our overall audience has continued to grow, reaching 238 million mDAU [monetizable daily active users] in Q2 2022."
Ironically, back in April, Musk himself pointed out that the majority of Twitter's most followed accounts "tweet rarely and post very little content. Is Twitter dying?" he asked.
Five days later, he offered to buy the business. ®