That’s billions, with a B. America’s Big Tech companies have had more intrusion and attempted persuasion over American voters than any Russian hacker could possibly dream of.
It wasn’t too long ago that Facebook founder Mark Zuckerberg was being grilled over censoring conservative voices Diamond and Silk. Now his company’s shares have taken a historic nosedive costing shareholders nearly $146 billion!
But the costs continue. There has been so much outrage from all sides for the censorship and loss of value that Facebook must now fork out millions of dollars in security detail just to keep Zuckerberg’s head attached to his shoulders and his family safe.
Other Big Tech companies aren’t immune either. It is no secret that Twitter has attempted to change their programs in order to silence conservative voices as well. Needless to say, Twitter didn’t foresee they full weight of their actions.
Twitter shares opened down 14 percent Friday after the company reported a decline in monthly active users and weak guidance.
Twitter reported second-quarter earnings before the bell on Friday:
- Earnings per share: 17 cents vs. 17 cents, according to a Thomson Reuters consensus estimate
- Revenue: $711 million vs. $696.2 million, according to a Thomson Reuters consensus estimate
- Monthly active users (MAUs): 335 million vs. 338.5 million, according to StreetAccount and FactSet estimate
Shares were dropped as much as 18 percent in premarket trading when the report was released.
The company issued weak guidance as well, with adjusted EBITDA between $215 million and $235 million. The full year projections declined compared to last quarter’s estimates, with stock-based compensation expenses ranging from $300 million to $350 million as opposed to $350 million to $450 million projected last quarter. It also increased its capital expenditures rates for the year from $450 million and $500 million estimated last quarter to $375 million and $450 million.
For the last quarter, Twitter reported 336 million monthly active users. The platform blamed not moving to paid SMS carrier relationships in certain markets where users have better access to Twitter or Twitter Lite, making changes to improve the “health” of the platform and some impact from GDPR, a set of regulations in the European Union intended to protect consumer data. In total, Twitter estimates about 3 million accounts were affected by these three reasons.
Twitter removed about 70 million accounts in May and June, but Twitter chief financial officer Ned Segal said most of those were not included in its reported metricsbecause they were not active on the platform for 30 days or more.
The company also recently purged fake accounts, but those changes occurred after the close of the second quarter, so it didn’t affect MAUs in this report. Twitter warned MAUs could go down even more next quarter.
“As a result of our health work, decisions not to renew or move to paid SMS carrier relationships in certain markets, and our decision to allocate resources towards GDPR and health, MAU could decline on a sequential basis in Q3,” it said in its shareholder letter. “Based on our current level of visibility, we expect the decline to be mid-single-digit millions of MAU.”
Daily active users grew 11 percent, but the company did not break out the exact number.
Twitter revenue grew 24 percent year-over-year, with strong advertising gains. Advertising revenue was at $601 million, an increase of 23 percent year over year. The company also grew its data licensing and other revenue business, which was up 29 percent year over year.