Twitter Inc (NYSE:TWTR) did not have the best of runs last year, having been under immense pressure on failing to trigger user growth to the Street’s liking while falling prey to Facebook Inc. (NASDAQ:FB)’s dominance of the space. Things could finally be looking up for the embattled social network as a series of new features on the microblogging site continue to show signs of promise.
A revamped homepage is just an indication of how focused CEO, Dick Costolo, is, on rebooting growth in the company, especially on user growth front. However, the networking platform continues to struggle with its same old problem of being perceived complicated compared to other networking platforms.
The addition of the ability to browse tweets by topic was seen as a major milestone, but not yet there in alleviating the complicated perception of the platform. Costolo has already reiterated that the company needs to accelerate the pace of its product change to make it more exciting, engaging, and less complicated. Ahead of the earnings call it is evidently clear that Twitter Inc (NYSE:TWTR) has a lot to do if it is to attain the mainstream status as Facebook.
The addition of Periscope app that allows people to upload live video streams is just an indication of how the company is trying to make the platform more exciting. Users can now send messages to a group as well as receive messages from strangers as part of the new upgrade.
However, SunTrust Robinson Humphrey analyst, Robert Peck, is raising skepticism on the ability of the new product changes to draw more users. The analysts has consequently downgraded the stock to a neutral having also raised concerns on its advertising business
Twitter only boasts of 288 million active users, a fate that has significantly affected its advertising business as advertisers push for platforms that can guarantee greater reach. Peck is also raising issue with suggestions that Twitter Inc (NYSE:TWTR)’s systems continue to air ads from top brands next to explicit content, something he believes could hurt the company’s prospect on the advertising front
Analysts at Axiom expect Twitter Inc (NYSE:TWTR) to post solid earnings, having reiterated a ‘buy’ rating on the stock with a share price target of $63. The research firm expects the research firm to show user growth in line with guidance.
However, the stocks long term prospect has been thrown into disarray after one of the company’s director offloaded a huge chunk of his holdings ahead of the earnings. Evan Williams is believed to have sold a total of 468,000 shares in a transaction worth $24,047,298.