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Twitter Stock Drops Double Digits on News of No User Growth

28 July, 2017, 00:09 | Author: Paula Vaughn
  • Twitter Inc

It reported 328 million monthly active users, up 5% year-over-year, but in line with 328 million reported in the previous quarter. Global revenues fell 1% year over year to $239 million in the reported quarter while the USA revenues decreased 7% year over year to $335 million.

The company also reported a wider quarterly net loss and lower revenue, and said it did not expect its total revenue growth to pick up in the second half of the year.

Daily active users, toward which management has recently been trying to shift investor attention, were up 12% year over year.

Beating low expectations is, I suppose, better than the alternative but even so, revenues of $574 million do not compare well to sales of around $602 million in the same quarter a year ago. Dear Shareholders, We look forward to discussing our second quarter 2017 financial results with you at 5am PT today.

Facebook reported having 1.32 billion daily active users, up 17% from the year-ago period and slightly above estimates of 1.316 billion. Mistreatment on the platform has scared off both advertisers and potential buyers, as Salesforce ruled out a bid for Twitter in part from concerns the social platform could not handle online abuse and trolls.

"Ultimately the value we're going to drive... is serving these audiences on Twitter" that are underserved in specific categories, COO Anthony Noto told investors in the company's earnings call Thursday.

Anne Hathaway eyed to replace Amy Schumer in live-action "Barbie"
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In a statement, CEO Jack Dorsey said he was confident in the company's approach to developing and engaging with its users.

Twitter Inc shares fell $1.71 (-8.72%) in premarket trading Thursday.

In the United States, Twitter's average monthly active users declined to 68 million in the second quarter from 70 million in the first quarter.

In the third quarter, Twitter said it expects adjusted earnings before interest, tax, depreciation and amortization of $130 million to $150 million. With a goal of reaching profitability, Twitter began investing heavily in video, aiming to draw a more mainstream set of users and premium advertising deals.

The company's net loss widened to $116.5m, or 16 cents per share, in the second quarter ended June 30, from $107.2m, or 15 cents per share, a year earlier.

Excluding one-time items, Twitter earned 8 cents per share, which topped analysts' consensus forecasts of a profit of 5 cents a share on $537 million in revenue.

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