Posted on 07/27/2018 6:29:21 AM PDT by Red Badger
Twitter Inc (NYSE: TWTR) shares plummeted 12 percent Friday morning after the company reported a drop in active users in the second quarter. While Twitter has been making major improvements to its platform, analysts say the stock is pricing in unrealistic growth expectations, and the latest numbers seem to confirm that belief.
Twitter reported second-quarter adjusted earnings per share of 17 cents, in line with consensus analyst estimates. Revenue of $711 million beat Wall Street expectations of $698.2 million. Revenue was up 24 percent from a year ago.
Despite the revenue beat, investors zeroed in on Twitter’s 335 million monthly active user count, which came up well short of consensus expectations of 338.5 million and was 1 million less than the 336 million the company reported a quarter ago. The lost MAUs came primarily from the U.S., where MAU count fell from 69 million in the first quarter to 68 million in the second quarter.
Investors had been concerned that reports Twitter had been suspending as many as 1 million fake accounts per day in the second quarter could negatively impact reported user numbers. Twitter said it removed a total of about 70 million accounts in the second quarter but said most of those accounts were never included in active user counts because they were less than one month old.
“Our second-quarter results reflect the work we’re doing to ensure more people get value from Twitter every day,” CEO Jack Dorsey says in a statement. “These efforts contributed to healthy year-over-year daily active usage growth of 11 percent and demonstrate why we’re investing in the long-term health of Twitter.”
Looking ahead, Twitter guided for third-quarter earnings before interest, taxes, depreciation and amortization of between $215 million and $235 million. Twitter is now forecasting full-year capital expenditures of between $450 million and $500 million, up from its previous range of between $375 million and $450 million.
[See: The 10 Most Valuable Tech Companies in the World.]
Bank of America analyst Justin Post says TWTR stock is pricing in growth that simply isn’t there.
“While we agree that the clean-up efforts are a long-term positive for the platform, we still have concerns on Twitter’s reach and anticipate pressure on MAU growth as suspension headwinds continue,” Post says.
Bank of America has an “underperform” rating and $27 price target for TWTR stock.
Hahaha, Trump complains about “shadow banning” and Twit’s stock falls.
Gab! Gab! Gab! Gab! Gab! Gab! Gab!
Go “F” yourself Dorsey.
I wonder if they were ALL part of trying to sway the election away from President Trump and have now finally conceded ....
Why would a bunch of talkers suddenly stop talking unless there were never any talkers there in the first place ?
Their stock fell because their growth has stalled...........
Twitter’s major problem is leftist trolls preventing balanced participation and leftist bias in their algorithms and moderating staff.
When Twitter and Facebook level off,reform and stop their overt political activity, IMHO they will be good investments. Like it or not they are a part of the culture and young people will continue to use them as their means of communication and identity.
Amazing. Censorship and discrimination isn’t good for business.
Just ask that zit-faced Zuckerberg and the commie at the Red Hen.
I was shadowbanned 3 times.
Just for my political views.
I bet they regret banning all those fake users (Obama followers) and “Russian bots”.
Like it or not they are a part of the culture and young people will continue to use them as their means of communication and identity.
I think everyone is kind of tiring of the whole thing, except those that spend all day on social media. Again, mostly grandmas.
Twitter says it was just a ‘glitch’ in their algorithm..........They should stop dancing with AlGore.................
Twitter is sewage for the weak of mind.
And I don't Twitter, Tweet, or make other bird noises ...
Wall Street is trying to tell us the reason for the price plunge today is the result of Twitter purging fake accounts.
However, ‘shadow banning’ is a major factor for the price drop.
Twitter is playing politics and Trump called their bluff.
Hoping they lose all their money and go bankrupt. They have established themselves as the front line in destroying any thought that runs counter to leftist dogma.
Something like social media is probably with us until something happens that causes a collapse of the infra structure, but it seems to me that there will likely be a great number of platforms succeeding each other, and that squeezing money out of a particular product in the long term is not something that can be guaranteed. The most likely scenario to me is a series of electronic gold-rush towns. Very good to be the first in, and ok to be a little late to the party, but you want to be sure that you will earn your capital back and you don’t want to buy in when the thing is on its way to being a ghost town.
The Zuck lost over $16 billion bucks in stock value over the last few days. Not his company, him personally..
Heh heh heh...
If it wasn’t for the President’s Tweets , I would never look at Twitter.
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