Twitter Stock Plunges after Revenue Misses Estimates
Twitterdisappointedinvestorsyet again with first-quarter results that showed stagnant revenue growth as the microblogging service struggles to grab new users amid efforts to improve its complicated interface with several new features. Twitter shares plunged 13.6% to $15.34 in late trade on Tuesday after reporting lowerthan-expected revenue, hurt by weaker-than-expected spending bybigadvertisers,andprovidinga current-quarter revenue forecast well below analysts’ expectations.
Twitter’s user base grew modestly to 310 million monthly active users in the quarter ended March 31 from 305 million in the fourth quarter, above analysts’ expectations. But investors were let down by the revenue miss since outlining a turnaround plan. “It’s obvious Twitter is having trouble,” said Arvind Bhatia, analyst with CRT Capital.
On a call with analysts, executives said advertisers held back spending ahead of major events, including the Olympics. They also said users were spending more time watching and sharing video, but that advertisers’ budgets had not yet shifted from legacy advertising products.