Twitter stocks dive 20% as users drop by a million

Twitter share price tumbles after it loses 1m users in three months

Twitter's EBITDA (Earnings before interest, taxes, depreciation, and amortization) was $265 million, up from $178 million a year ago, but critically, their monthly active users for the quarter were 335 million, down from 336 million in the first quarter.

"We want people to feel safe freely expressing themselves and have launched new tools to address problem behaviors that distort and distract from the public conversation", CEO Jack Dorsey said in a prepared statement.

Shares in Twitter slumped 16 percent in pre-opening trades in a market jittery following a weak outlook from social network leader Facebook.

A Washington Post report put the total number of suspended accounts in May and June at 70 million.

Tech firms have been under pressure in several countries to be stricter over abusive content and misinformation or "fake news" as well as political influence and protection of personal data.

Revenue of $711 million, mostly from advertising and up 24 percent from past year, exceeded the average estimate of $696 million among analyst research aggregated by Thomson Reuters. Non-GAAP earnings were 17 cents per share on revenue of $711 million, up 27 percent year over year.

Although user numbers alarmed investors, Twitter's business remains strong.

Twitter raised its 2018 capital spending forecast and said adjusted EBITDA margins in the third quarter would be below the second quarter's.

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Twitter's losses followed "Facebook Thursday" - a catastrophic day in the history of Facebook.

The company's stock plunged today after it reported a decline in its monthly users and warned that the number could fall further in the coming months.

Twitter said it expects monthly active users to decline in Q3, as well. They were all attacked by foreign fraudsters during the 2016 US election looking to disrupt the online discourse and spread fake news. US advertising grew 9%, to $293 million.

As part of these efforts, Twitter said that as of May, its systems had identified and challenged more than nine million accounts per week that were potentially spam or automated, up from 6.4 million in December 2017. Both companies are hitting a ceiling for user growth. Analysts had expected 340 million monthly active users in the third quarter, according to Thomson Reuters I/B/E/S. "But arguably Twitter looks in better shape as the efforts to monetise the platform are working, whilst we see fundamental concerns about Facebook's advertising model".

Average U.S. MAUs were 68 million for Q2, flat with the year-earlier period and down from 69 million in Q1.

Cracking down on hate, abuse and online trolls is also hurting Twitter's standing with investors.

Twitter also saw usage fall after saying it would not subsidize messaging fees for users who accessed its app through text messages. The company again flagged its push to increase headcount this year.

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