Here's why:
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.
“Deja Vu allover again...................”
Exactly. Reminds me of the Dot Com Bubble bursting in 2000. Except, President DJT is keeping the economy from crashing with his Kick Butt economic policies. Wait ‘til the new GDP numbers come out.
I think we may be seeing the end of Mark Zuckerberg (Facebook) and Jack Dorsey (Twitter) as CEO’s. And it could end a lot faster than people think.
Remember the cb craze of the early ‘80s? Everyone had cb radios in their cars and trucks and talked about Smokies. It was a fad that ran its course, and people dropped it. That’s what social media seems to be. A lot of money will be lost on this collapsing fad, however.
Here's why:
Maybe people are suddenly realizing that you can’t say anything of real importance in 144 characters. I have always seen it as more as a service to massage the egos of self important people; “I am going shopping at Whole Foods”, “I am buying Charmin to wipe with”. Who really cares?
Users/stakeholders react to fb and twitter manipulating information.
Besides, a site based out of Anguilla is a loser for US users!!! Stupid to use .ai
That reminds me of Wisconsin governor Walker as that literally is his Twitter history!
(1) You need to educate yourself on Twitter for you know not of what you speak.
(2) First of all, the limit never was 144 characters. It was 140 characters and has been raised to 280 characters since.
(3) Secondly, links to more substantial articles easily fit within those 280 characters.
(4) Lastly, you can thread your tweets like I did here, allowing followers to pull up the entire thread at once.
BEAUTIFUL NEWS!!
Die Twitter!
Jack will join Zuck in the poorhouse, lol.
Twitter is like GeoCities or MySpace...
Wasn’t that in the mid to late 70’s
That cartoon really sums it up well. Conservatives not welcome. The problem is that once they go down that path they have to split hairs about what is further allowed or not, alienating even more people. It is a losing approach. They should focus on delivering a even-handed, respectful platform, the town square. Applies rules to all parties evenly and recognize that not everyone is in favor of their Democratic, liberal, progressive, socialist fascism. It IS OKAY to think Christianity is okay, Islam is evil, homosexuality is a perversion, gender and race identity are wrong or abused, capitalism is good, etc.
I really don’t recall seeing CB radio’s much past the very early 80s.
I’m thinking at first glance. Cows Twittering each other by stock tanks?
Yeah. Young mush brains never even THINK of picking up a phone, having a face to face, nor do they realize putting every little thought out into the world is just plain stupid. Twitter people are the sort of folks who think sex with robots is the next bestest thing, EVAH!
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