From Jim Collins writing at Forbes:
Death. Taxes. A terrible Twitter quarter. These things are inevitable, it seems. As Twitter shares plummeted 10% in after-hours trading, the questions raised by management’s conference call outnumber those answered.
After reading the call transcript, I believe analysts were trying to get get Twitter management–CEO Jack Dorsey, CFO Anthony Noto and COO Adam Bain–to confirm two basic theses that would be necessary to support Twitter stock. Put another way, TWTR shares have been major laggards but if there is a bottom one would have to be comfortable that these two key business model pillars still exist at Twitter:
- Twitter is a source of vital information used daily by a large cohort of users.
- That user base is important enough to advertisers to pay a premium to reach them.
So, on point one, Twitter steadfastly refuses to release the one figure that will prove or disprove the thesis: daily user (DAU) numbers. Twitter only releases monthly average user (MAU) numbers and growth in that metric in the second quarter was more of the same slog (+3% year-on-year, +1% sequentially). Despite being asked repeatedly on the call to release DAU numbers, Twitter management would only note that the ratio of DAUs to MAUs has remained stable in recent quarters.
Read the rest of the story at Forbes.