Amid the economic uncertainty, microblogging site Twitter Inc has warned its employees that they might receive only half of their typical annual bonuses. The social media company, which is fighting a legal to complete a $44 billion sale to Elon Musk, made the announcement in an email to employees and blamed its financial performance for the potential bonus reduction, according to a report by New York Times. As per the US daily, Ned Segal, Twitter’s chief financial officer, said these challenges would probably affect the annual bonuses that they receive, with the bonus pool currently at 50% of what it could be if the company met its financial targets, according to two employees who received the message.

Last month, Twitter’s revenue declined for the first time since 2020 amid fierce competition from Apple and TikTok in a weakening advertising market. The company reported second-quarter revenue of $1.18 billion, compared with $1.19 billion a year earlier.

Twitter ties its annual bonuses to its performance against revenue and profitability goals.

Other factors have thrown the company’s future into uncertainty. Tesla CEO Elon Musk’s initial bid to buy Twitter – and his erratic attempt to exit the deal – have thrown the two entities into a protracted legal battle.

Twitter was set to sell the company to Musk for $54.20 per share, making its financial reports little more than a formality as it awaited the deal to close.

But Musk tried to back out of the deal on July 8, claiming Twitter hasn’t been forthcoming with information on the number of fake accounts running rampant on the site.

As a result, Twitter has sued him to force the acquisition. The company is set to face off with Musk in an October trial in Delaware Chancery Court.

To read more about the cuts to Twitter’s annual bonuses, click here.

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