Twitter sanctioned on the stock market after disappointing results
Twitter continues its descent into hell: the stock market has unscrewed to the announcement of results and forecasts that have disappointed the market. The share, which was worth 70 dollars at the end of 2013, is now at 17 dollars.
The action of the American social network Twitter collapsed Thursday February 9 at Wall Street after the group announced results and forecasts that disappointed the market without reaching to profit from the “Trump effect”. The stock fell by 9.72% to 16.89 dollars in the first exchanges. It had climbed to nearly 70 dollars by the end of 2013 before tumbling. He had managed to stem his downturn in the stock market over the last twelve months.
Twitter currently enjoys a strong effect of notoriety as it is the preferred channel of communication of the new American president Donald Trump but still struggle to attract new users and to attract more advertisers.
Its turnover was well below expectations for the last three months of last year at $ 717 million. The increase is only 1% compared to the same period last year and also below the forecasts of financial analysts that were 740 million dollars.
Twitter has never seen a net profit since its inception ten years ago, and the return to command of its co-founder Jack Dorsey in 2015 does not seem to be enough to boost its growth.
Few new users
It still struggled to garner new users in the fourth quarter: at the end of December, it was 319 million compared to 317 million at the end of the previous quarter.
Increasing the number of users is crucial for Twitter to convince investors of its ability to improve its bottom line and deliver profits.
Jack Dorsey said Thursday in a conference call with analysts that his group had “met the biggest challenge of any service to consumers by reversing the declining trend of its audience and accelerating its use” Of its services.
He pointed out that “active daily use has accelerated for the 3rd consecutive quarter and we see this trend continue”.
Over the year, sales were $ 2.53 billion, up 14% and just below market expectations ($ 2.55 billion).
Twitter has also delivered fairly pessimistic forecasts for the current year, notably indicating that its advertising revenue growth should not be as fast as that of its users due in particular to competition from other social networks in the Online advertising.
For the year, the loss was $ 456.9 million, down 12.3%. In the fourth quarter, however, it was significantly aggravated at $ 167 million for $ 90.2 million a year earlier, mainly due to restructuring charges.
According to adjusted earnings per share, which are the basis for analysts’ expectations, earnings per share are $ 0.57 for the year and $ 0.16 for the quarter. Analysts were expecting earnings per share of $ 0.52 and $ 0.12, respectively.
In a letter to shareholders accompanying the release of the results, Twitter said it was considering removing certain products to simplify its operations but without achieve sustainable long-term revenue growth,” the group said.Spending increased by 11% year-on-year to $ 861 million due to higher restructuring costs. Twitter had announced in October the suppression of 9% of its workforce, about 350 jobs. It employed at the end of December 3,500 people for 3,860 three months earlier.