Twitter Still on the Ropes

twitter stock walking tightrope

Twitter beat analyst expectations for the quarter that ended in September, but that doesn’t seem to be doing the company any good. The stock closed up by a hair on Wednesday, but went sinking down in after-hours trading.

Adjusted earnings per share came in at $0.13 on revenues of $615.93 million, compared to forecasts of $0.09 on $604 million. Even better, advertising grew by 6%. If Twitter is going to join the big league success of Google and Facebook, that is the number which will have the most impact.

Ordinarily, those numbers would have been more than enough reasons to smile kindly on the stock. But they were overshadowed by all the negative signs surrounding the company.

  • Twitter is having a hard time finding a buyer. Disney didn’t want its family friendly image to get besmirched by the negativity being spewed all over the platform, Microsoft is in the throes of a LinkedIn acquisition, Google doesn’t need it for ads and a lot of other possible suitors are more interested in enterprise applications.
  • Twitter killed Vine. The video app couldn’t keep up with the competition from Instagram. Part of the reason may have been that the six second limitation wasn’t nearly long enough to be useful to advertisers. It might have been wiser just to try extending the video time, but they just shut it down instead.

Twitter didn’t offer any revenue forecast in the last report, offering instead a projected EBITDA (earnings before interest, taxes, depreciation, and amortization) of $700 million-$715 million for the year. That also exceeded the market expectation for $699 million.

In the meantime, Twitter’s stock closed at $17.61 on Wednesday, a far cry from the 52 week high of $30.15 that it reached last November and closer to the 52 week low of $13.73 that it hit this past May.