After a great deal of ups and downs, which have been mostly downs, Twitter’s (NYSE: TWTR) shares have stabilized. They are flat for the year, The period during which Twitter shares surged due to buyout activity are month’s past. The shares appear to have settled to the point where they will trade on earnings rather than speculation. They trade at $16,58
Twitter has had another windfall of visibility as the Trump inauguration, his recent tweets, and more tweets from protesters who numbers in the millions across the country. Twitter’s most vexing problem, despite the activity, continues to be that marketers have not been able to turn this activity into successful advertising campaigns. The worry about the company is that this progress will never happen.
Twitter’s expected earnings figures have already disappointed Wall St. based on the company’s full year 2016 forecast:
For full year 2016, Twitter expects:
• Adjusted EBITDA to be in the range of $700 to $715 million;
• Adjusted EBITDA margin on GAAP revenue to be 27.5% to 28%; and
• Capital expenditures to be no more than $360 million.
Twitter’s lack of ambition to expand beyond the tweet business has also been an issue. According to Barron’s
Twitter’s ambitions continue to shrink. The latest evidence is the company’s decision this week to sell software designed to help mobile app developers.
Twitter is selling its software toolkit Fabric to Alphabet, the owner of Google, for an undisclosed sum. Fabric launched in 2014, and Twitter had planned to use it to build relationships with mobile app developers. The hope was those developers would build products that interact with Twitter, and possibly broaden its uses and audience.
Twitter, it seems, hardly has any ambition at all.
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