Twitter Becomes Latest Victim of October's Mini Tech Wreck
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In case you haven't noticed, this has been a miserable month for tech — especially for those companies that couldn't find a way to beat Wall Street's expectations.
Just ask Twitter. The social media darling did pretty much everything that analysts has asked. The company more than doubled its quarterly revenues, posting sales of $361 million. Twitter turned an actual profit, albeit a mere penny a share. But that was what Wall Street analysts had been expecting.
Meanwhile, the company reported that the number of active users grew 23%; timeline views (Twitter's equivalent of website page views) increased 80%; and ad revenues from those page views increased 83%. Still, as UBS analyst Eric Sheridan told USA Today, the results lacked "upside surprise."
The result: Investors pummeled the stock, which lost more than 10% of its value in after-hours trading Monday.
TWTR Price data by YCharts
Twitter wasn't the only technology company to be taken out to the woodshed.
Last Thursday, Amazon.com did what it usually does — the e-commerce giant reported robust sales growth, but couldn't manage to turn a profit amid its massive build out. Investors weren't in a forgiving mood, shaving more than 8% off the stock's price:
AMZN Price data by YCharts
The day before that, Yelp reported decent results, but the review site warned investors that fourth quarter sales would fall short of expectations. The result: Investors erased nearly a fifth of the value of the social media company:
The week before that, Google reported strong profits, but said that the amount of money it is making per ad is falling. That was enough to knock the stock down.
And the day before that, Netflix announced it attracted far fewer new U.S. members for its streaming video service than was previously estimated. That was enough to erase more than a fifth of the company's market value: