On Monday, Twitter accepted a bid from Elon Musk to buy the platform for about $44 billion, putting the world's richest man in the driver's seat of one of the world's biggest social media apps. This means Twitter's Q1 2022 earnings report, released Thursday, could be the last public earnings before the platform goes private.
1. How did we get here?
Musk, the world’s wealthiest person, will own one of the world’s largest megaphones and could impose his will on how it operates, essentially giving him the ultimate bully pulpit, according to Insider Intelligence senior analyst Gadjo Sevilla.
The Twitter-Musk drama has been brewing since the Tesla CEO started buying Twitter stocks, accumulating about a 9% share of the social network at the beginning of April. The two sides reportedly worked through Sunday night to finalize a deal.
Learn more about Musk's path to purchase.
2. What's in store for the app?
The purchase gives Musk control over Twitter's advertising model—something he has publicly questioned in the past, according to Jeremy Goldman, principal analyst at Insider Intelligence.
One of the things Musk likes about Twitter is that it enables him to talk directly to his 88 million followers; if it becomes less of a brand-safe platform—similar to Reddit, particularly before it began ramping up toward its IPO—some of those followers could become less active or depart Twitter entirely.
Ads currently account for about 90% of Twitter's revenues; the rest comes mainly from data licensing.
Read more on Musk's potential plans for the platform.
3. Meanwhile in the metaverse...
3D advertising is poised to make inroads this year, with Twitter and Meta among the players looking to this subset of ads as a potential growth driver.
Twitter announced three ad products in a bid to increase dynamic storytelling. One of these formats, Product Explorer, will let advertisers exhibit a product in 3D, with users able to swipe and rotate it to get a better look.
Product Explorer and Twitter’s other new ad formats are designed to create a more visually noticeable break from the main Twitter feed, which can make the ads either stand out or seem intrusive—or perhaps both.
Learn more about advertising at Twitter.
