How Elon Musk’s Twitter takeover impacted Tesla stock

Yahoo Finance’s Dan Howley explains the timeline of Elon Musk’s Twitter takeover and how it has affected Tesla’s stock price.

Video Transcript


DAN HOWLEY: No discussion of Tesla is complete without talking about Elon Musk’s decision to buy Twitter. The CEO’s tumultuous path to owning the social network coincides directly with Tesla’s share prices. So where do we go from here and how did we get here? Let’s take a look.

Everything started around January when Elon Musk started amassing shares of Twitter. We didn’t find out about that, though, until April 4 when he disclosed that he had purchased a 9% stake in the company. And on April 5, he then was offered a board seat by Twitter.

He later rejected that, though, saying that he didn’t agree with the moves that Twitter wanted to make at all. So on July 8, he went ahead– and sorry, excuse me, on April 25 he said that he was going to buy the company for $44 billion at $54.20 a share.

But on July 8, he said that he didn’t like the terms of the deal. He essentially claimed that Twitter wasn’t providing him with enough information about bots, something he said he wanted to clean up on the platform, and that they weren’t giving him the data that he had been requesting over and over again. So he filed to try to do away with the deal entirely.

On July 12, though, Twitter struck back. They sued to try to force him to purchase the company. He said that the company didn’t offer him exactly what he wanted. They said that they had. While all this is going on, by the way, Twitter’s former security head came forward to say that the company had awful cybersecurity practices, and actually sat before Congress to discuss this.

The lead-up to the trial between Elon Musk and Twitter, though, also resulted in a number of text messages coming out between Musk and power players in Silicon Valley, going over how he would potentially change practices at Twitter, who he would allow on, the kind of discussions that he would allow there, how he would potentially monetize the platform, so on and so forth.

And just as they were about to go to trial, Elon Musk on October 3 came forward and said that he would finally agree to purchase the platform for $54.20 a share at $44 billion. Later in October, the agreement was finalized. And now, he is the owner of one of the most influential social media networks around.

RACHELLE AKUFFO: [INAUDIBLE] roller-coaster it took to get here, where is Twitter right now?

DAN HOWLEY: It really is in almost this strange state of operating but at minimum capacity. He obviously laid off roughly half of the company, then he laid off even more staffers. He had to hire some of them back. There’s offices that are shutting down because they’re not paying rent.

This is an issue that goes beyond just the employees. I mean, the “New York Times” did a piece basically pointing out that there aren’t enough janitorial staff at some of these locations and so some people are being forced to bring in their own toilet paper. There’s rooms that smell like bathrooms or rotting food. There’s server issues.

There was a potential problem that we had seen where Twitter was running slowly. A server that Elon Musk had ordered be shut down could have helped prevent that kind of slowdown. And then we’re still talking about who’s allowed back on the platform and who’s not– you’ll remember that Elon Musk, who previously was relatively close with Kanye West, allowed him back on the platform and then he immediately kind of shot himself in the foot talking about anti-Semitism.

He also brought back the controversial right wing influencer Andrew Tate, who immediately, well, got owned by Greta Thunberg. But this is something that I think we’re going to continue to have to kind of parse– whether or not Elon Musk is putting enough time into Twitter, whether or not he’s putting enough time into Tesla, how he can do all of this with SpaceX in between.

But the Twitter problem is this is an entirely different endeavor than what he’s done previously. This is a social network. So this is not being able to buy– sell cars or put together spaceships. I think that when it comes to Twitter, he still has a lot of his work cut out for him.