Yahoo Finance Tech Reporter Allie Garfinkle discusses the latest developments in the Elon Musk-Twitter legal saga and how investors are responding to the uncertainty around the case.
AKIKO FUJITA: But let's turn now to the ongoing Twitter saga with Elon Musk. The unhappy marriage might look like it's headed for court, but rumors of a possible deal are sparking hopes, at least among Twitter investors. Here with more, Yahoo Finance's Allie Garfinkle, who's in studio with us today. So we obviously got a date, right, on the calendar in terms of where they're likely to head in court. What's the latest?
ALLIE GARFINKLE: So we have fewer than three weeks to go before this date, Akiko, before this trial is scheduled. And both Musk and Twitter seem to be dragging their feet, right? Right now, my sources tell me this can kind of go one of two ways. One, things are taking a turn for the worse, or two, both sides could be headed towards a deal of some kind. Now, the latest today is that depositions for both Musk and Twitter CEO Parag Aggarwal aren't happening this week, as originally planned.
Now, we're hearing that those depositions have been rescheduled, which is indicating that things are moving forward slowly, but surely. But there is still a lot of hope, at least among investors, for an out-of-court settlement. We saw Twitter stock go up today on hopes for a deal, and we saw the same thing last week. So these latest developments aren't concrete, right? There's a lot we don't know.
But my sources throughout the saga have kind of repeated the same thing to me about how it can play out, which is that ultimately, Musk could be set to lose here either way. The question is just by how much. It's not necessarily likely that the court will make Musk go through with the deal in full, but Musk is probably liable for something here.
INES FERRE: And do we have any idea how has this Musk and Twitter drama hit advertising for Twitter?
ALLIE GARFINKLE: That's a great question, Ines. It's not a secret that the digital advertising market has really been roiled in the recent months. It's rattling big tech specifically. And Twitter is absolutely included in that. The difficult macroeconomic environment-- inflation, high interest rates, war in Ukraine-- it's definitely facilitated less spending in advertising. That said, we do know reportedly that advertisers are specifically moving away from Twitter due to this kind of volatility. They don't know what's going to happen with the platform. And they're not willing to spend money there.
INES FERRE: How interesting. Thank you so much, Yahoo Finance's Allie Garfinkle.