Shares of micro-blogging tech firm Twitter fell by 10 % after it was reported that its revenue forecast fell short of expectations. The firm’s revenue during 2019’s first quarter is likely to be around $715million to $775 million which is below forecast made by analysts. Though the firm reported profits of around $225 million during last quarter of 2018 its shares fell due to combined effect of fall in revenue and its declaration that operating costs during 2019 would rise by 20 %. This is because now social media firms like Facebook, Twitter, WhatsApp and their ilk are under pressure to have stronger safeguards in place.
Rising cases of hate speech, concentrated political campaigns, intimidation and bullying by social media has brought them under scrutiny of government regulators. Twitter declared that it removed several million abusive accounts as per regulations that led to fall in total number of monthly users. Presently the total number of Twitter users is at 321 million which represents a fall since last year when it had 330 million active users. Though the social media platform’s users declined its revenue during last quarter of 2018 grew by 24 % due to growth in video advertising.
Twitter CEO Jack Dorsey stated that growing revenues is proof that its long term strategy is effective and in the forthcoming years Twitter will grow as a strong company which provides a safe, healthy and conversational platform for people to express their views. It will also change its reporting policy and disclose only active daily user numbers instead of previous practice of disclosing monthly user numbers. It drew around 126 million users during fourth quarter of 2018 on a daily basis when compared to 1.5 million daily users of Facebook and 186 million daily users or Snapchat. Analysts say that high operation costs are likely to affect Twitter’s profit margins in the future starting from 2019.
