the shares are a hit as Wall Street absorbs the company’s earnings report for the first quarter. Analysts say the market is disappointed with the company’s second-quarter outlook and signs of weak consumer growth.
Shares on Twitter (ticker: TWTR) fell about 13% to $ 56.72 late Friday morning. The
the index had fallen by 0.6%.
BofA Securities analyst Justin Post wrote on Friday that Twitter revenue for the first quarter was in line with expectations, although advertising of US brands was slow in January and February. He noted that consumer growth is lower than expected.
Post called the company’s prospects for the second quarter confusing, arguing that the call should have been higher, given that management indicated a reimbursement of brand costs in March. The company said revenue was likely to be between $ 980 million and $ 1.08 billion, while Wall Street’s consensus was that the figure should be $ 1.06 billion.
Wedbush analyst Ygal Arounian wrote in a note Friday that he believes Wall Street will focus on slowing consumer growth, noting that investors are increasingly focusing on whether consumers remain committed to apps like Twitter now that the pandemic is giving way. USA
“All peers in Twitter’s digital advertising have seen a significant improvement in revenue with guidance ahead of expectations for 2Q, which means that Twitter has so far been slightly less involved in the recovery of the digital advertising market,” Arunyan added.
In a note titled “This bird detects low-air turbulence,” MKM Partners analyst Rohit Kulkarni called it a mixed quarter for Twitter. He said that the growth of advertising revenues seems to lag behind the analogues
(SNAP), which reported earlier in April. He also noted that the growth of Twitter users is softer than expected.
“While yesterday’s results do not inspire confidence in management’s ability to keep a steady pace, we believe Twitter remains a solid ‘opening’ game with sports and live events over the summer,” Kulkarni wrote.
Oppenheimer analyst Jason Helfstein is also looking forward to the return of live events, saying that stopping them weighs on revenue growth.
“While the market reacts to the weaker prospects for 2Q, after the optimistic day of investors, we are more optimistic about the rhythm of the product and expect the strength of the brand,” in the second half of 2021, writes Helftstein.
At least for now, investors seem less optimistic.
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