Twitter’s stock price crashed 20% in pre-market trading on Thursday morning, after the social media giant reported it fell short of both earnings and revenue estimates during the third quarter. The sales and earnings misses offset a healthy Q3 spike in users, at least according to the early response of Wall Street.
The company, in its letter to shareholders, pointed to “bugs” that impacted its ability to “target ads and share data with measurement and ad partners.” Twitter also “discovered that certain personalization and data settings were not operating as expected. We believe that, in aggregate, these issues reduced year-over-year revenue growth by 3 or more points in Q3.”
Twitter posted Q3 earnings per share of 17 cents, about 3 cents shy of analyst estimates. Sales increased 9% year-over-year to 824 million, but fell well short of analyst projections of $875 million; $702 million in ad revenue made up the bulk of its Q3 sales.
Compounding its bug problem, Twitter pointed to “greater-than-expected advertising seasonality” in July and August in explaining its Q3 revenue miss.
Twitter’s stock fell nearly 20% in pre-market trading to about $31 per share. If the losses hold through the end of Thursday, it would nearly wipe out a strong performance from Twitter’ stock to date this year, after opening 2019 at about $29 per share.
The company, like most social media platforms, is typically has its share price closely tied to whether it reports strong user growth. But the pre-market stock drop comes despite Twitter hitting 145 million “monetizable daily active users,” its internal metric for DAUs, marking a 17% year-over-year growth. The company added 6 million mDAUs during Q3.
“We drove strong growth in monetizable DAU (mDAU), up 17% year-over-year, driven by ongoing product improvements. We’re continuing to improve relevance while testing ways to make it easier for people to find what they are looking for on Twitter,” Twitter chief Jack Dorsey said in a statement.
Dorsey added Twitter continues “to make progress on health, improving our ability to proactively identify and remove abusive content, with more than 50% of the tweets removed for abusive content in Q3 taken down without a bystander or first person report.”
Twitter will host an earnings call at 8 a.m. ET to discuss its earnings.
Hollywood's Crazy 2018 on Twitter, From Least to Worst Consequences (Photos)
The power of a tweet has never been stronger in Hollywood. One wrong step and you can lose your job, your fans and, in some cases, your career. TheWrap has put together a list of Hollywood tweets that have proven costly in 2018.
(Dis)honorable Mention: Forky in 'Toy Story 4' teaser
On a more lighthearted note, Twitter was left bewildered when Disney Pixar introduced a new character in a "Toy Story 4" teaser in November. It wasn't a toy, but a utensil.
Considering Disney Pixar's track record, the backlash about Forky is likely only temporary. I mean, they made us fall in love with a rat.
After staying away from the spotlight early in the year, West returned to our lives and Twitter feeds in April, announcing that he was going to write a book called "Break the Simulation." The book never came to fruition. Instead, he spent the following weeks leading up to the release of his album "Ye" waxing poetic about his philosophy on life through his tweets.
Then things turned political.
"You don't have to agree with trump but the mob can't make me not love him," West tweeted on April 25. "We are both dragon energy. He is my brother. I love everyone. I don't agree with everything anyone does. That's what makes us individuals. And we have the right to independent thought."
West fans were puzzled by this remark, considering that he once said former Republican president George W. Bush didn't care about black people on live TV. His reputation continued to fracture when he wore a MAGA hat on SNL and even held a meeting with the president.
Bette Midler
Many in the U.S. were glued to their TVs for Supreme Court appointee Brett Kavanaugh's confirmation hearings in late September. During the hearing, Kavanaugh addressed sexual assault allegation made against him.
Seemingly frustrated by the treatment of Dr. Christine Blasey Ford, "Hocus Pocus" star Bette Midler tweeted that "women are the n-word of the world" in an attempt to compare the current strife to centuries of racism.
Midler later apologized, saying, "The too brief investigation of allegations against Kavanaugh infuriated me."
Despite backlash from fans, Midler did not face immediate repercussions because of the tweet.
Roseanne Barr
For the first few months of 2018, Roseanne Barr bestrode the entertainment world like a colossus. The first episode of the revival of her beloved 1990s sitcom "Roseanne" was the highest-rated entertainment telecast on a Tuesday in six years, and ABC gave it early renewal just three days later.
The season's final episode aired May 22 to still-huge ratings. Seven days later, it was all over.
On the morning of May 29, Barr went on a rant with a series of increasingly confrontational political tweets, culminating in a tweet about the appearance of former Obama advisor Valerie Jarrett that was widely denounced as racist.
She later apologized to Jarrett, but the damage was done. ABC fired her and canceled "Roseanne" the next day, then three weeks later greenlit a continuation series called "The Conners" with the same cast and crew, minus Barr.
Kevin Hart
On Dec. 4, comedian Kevin Hart posted on Instagram that after years of being asked to host the Oscars, he would finally do so in 2019.
The post immediately led to backlash when Twitter users dug up years-old tweets from Hart joking about punishing his son if he found out he was gay.
Two days after the initial announcement, Hart stepped down as host.
"I'm sorry that I hurt people.." he tweeted. "I am evolving and want to continue to do so. My goal is to bring people together not tear us apart. Much love & appreciation to the Academy. I hope we can meet again."
Upcoming "Jonny Quest" screenwriter Terry Rossio
The "Shrek" and "Aladdin" screenwriter sent a controversial tweet in November explaining his thoughts on those who vaccinate their children.
The backlash led to him apologizing, although there is no word on his status in the upcoming "Jonny Quest" film.
(Dis)honorable Mention:"Breaking Bad" actor Dean Norris
We're not sure if he meant to tweet it or not, but when Norris simply tweeted the words "Sex gifs" on May 22, he was flooded with responses making fun of the situation.
Norris never told us what the tweet meant. Since he probably won't ever get reprimanded for the harmless tweet, we might never know.
(Dis)honorable Mention: Mark Ruffalo addresses 'Avengers 4' slip-up
The "Hulk" star let the name of the upcoming Avengers movie slip on Jimmy Fallon in early October.
".@JimmyFallon, I trust that you will cut my spoiler slip on the show tonight. That was 'off the record' homey," Ruffalo tweeted on Oct. 5.
But Ruffalo and the "Tonight Show" underestimated the smart people of the internet. When the clip of the interview aired, the internet did its magic and took the bleeped clip of Ruffalo and found that he said the words "End Game." Whoops.
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The year taught us to be careful before we press send — just ask Roseanne or Kanye
The power of a tweet has never been stronger in Hollywood. One wrong step and you can lose your job, your fans and, in some cases, your career. TheWrap has put together a list of Hollywood tweets that have proven costly in 2018.
