Categories Analysis, LATEST, Technology

BREAKING: Twitter stocks are tanking today. Here is why

Twitter (TWTR) is likely heading towards its worst single-day decline, losing as much as 8.4% of its value in the morning trade today. The decline is apparently spurred by a report on Friday by Washington Post that the social media giant is suspending over a million fake accounts every day.

The company also told Post that its current purge rate is double of what it had in October last year. While the move will help reduce the number of junk bots on Twitter, Post hinted that it could weigh down on the company’s user growth.

Going by its current rate, Twitter removed as many as 70 million accounts in the months of May and June. The San Francisco-based tech giant has set up an automated system through which, suspicious accounts are challenged, or given tasks such as to update phone numbers.

RELATED: Jack Dorsey reboots Twitter’s leadership team

The company is expected to report its user base later this month along with the quarterly earnings results. As user numbers are widely used to assess a social media company’s health, the massive suspensions are leading to a backlash in the stock market.

Meanwhile, the move is expected to improve user experience in the long-term. Advertisers will also benefit from this filtration as junk bots don’t generate engagements or clicks. It may be noted that 85% of Twitter’s revenue comes from ads.

RELATED: Twitter brings accountability to political advertising

There has been a surge in fake accounts on Twitter after the social media giant banned crytptocurrency advertisements. There have reportedly been numerous scams, besides attempts to publicize digital money through fake accounts.

Twitter Q1 results (Click to enlarge)

Twitter Q1 2018 Earnings Infographic

Most Popular

Key highlights from Autodesk (ADSK) Q4 2021 earnings results

Autodesk, Inc. (NASDAQ: ADSK) today reported its fourth quarter financial results for the period ended January 31, 2021. Net income for the fourth quarter was $911.3 million, or $4.10 per

Infographic: Beyond Meat (BYND) reports wider Q4 loss; Revenue up 4%

Beyond Meat (NASDAQ: BYND), a specialist in plant-based meat substitutes, Thursday reported a wider loss for the fourth quarter, despite an increase in revenues. The numbers also missed the consensus

Virgin Galactic stock tanks on delayed test flight

Virgin Galactic (NYSE: SPCE) reported fourth-quarter 2020 financial results after the regular market hours on Thursday. The space tourism company reported zero revenue in the fourth quarter, compared to $529,000

Tags

Add Comment
Loading...
Cancel
Viewing Highlight
Loading...
Highlight
Close
Top