Twitter has yet again failed to grow its user base in the second quarter of 2017 when compared to the first quarter. This is primarily due to intense competition from the likes of Facebook and Snapchat, as both social platforms continue to draw new fans.
On Thursday, the micro-social media platform shares fell by 5 percent in premarket trading. Furthermore, revenue decreased by 4.7 percent following a $55 million impairment charge. That’s a problem for Twitter since all its major competitors are growing and the same is not happening.
Major streaming opportunity lost
For quite some time, Twitter has attempted t boost revenue by signing live-streaming deals with several companies. However, things took an unfortunate turn when Amazon managed to sign a major deal with the NFL to live-stream major games.
Chances are, Twitter is looking into tapping into the resources of another major sporting outlet, but that’s going to be difficult.
When it comes down to Monthly Active Users, the social network is doing just fine. At the moment, it has 328 million monthly active users, and analysts expect that number to rise to around 328.8 million. That’s not a lot, and as such, Twitter won’t gain much from it.
Monthly active users are always a key way to indicate whether or not a company is performing well, for those who are wondering.
Falling ad revenue
As for advertising revenue, it fell by 8 percent to $489 million, but that’s ahead of the $458.1 million estimate by industry pundits.
Michael Patcher, popular analysts from Wedbush, claims that advertisers might decide to use other platforms with better targeting instead of Twitter. For the micro-social network to regain lost ad budgets, the company will need to find a way to increase its user base.
However, that’s easier said than done, especially with Facebook trying new ideas.
Twitter may never bounce back
The micro-social network isn’t as feature rich as some of its rivals, and that could be a major reason why it is unable to grow. It’s all about writing 140 characters worth of tweets with images attached. It doesn’t have a lot of variety to it, but that’s what makes the platform unique.
The company has little choice right now to either improve its business to be more like Facebook or go the way of MySpace. Competition is growing as Amazon recently announced its entrance into the social media market with Spark. The retail giant is paying publishers and bloggers to post content on its social platform in a bid to transform it into a powerhouse.
Twitter doesn’t have the same ambition as Spark, and that’s a major problem going forward. Not to mention, with Amazon CEO, Jeff Bezos recently becoming the world’s richest man, it’s clear that Spark will get a lot of attention.
