Shrinking user base triggers sharp fall in Twitter shares
New York : A sequential decline in its monthly active users (MAUs) base triggered a sharp fall for Twitter shares in the after-hours trade, as the company announced its fourth quarter results on Wednesday.
 
The micro-blogging site reported 305 million monthly active users for the fourth quarter, compared to 307 million in the third quarter that excluded SMS-only followers.
 
The almost-flat user growth led to its shares falling as much as 13 percent in extended trading, Tech Crunch reported, hitting another new low of around $13.75 before flattening out to 3 percent in extended trading.
 
"We saw a decline in monthly active usage in Q4, but we've already seen January monthly actives bounce back to Q3 levels. We're confident that, with disciplined execution, this growth trend will continue over time," the company said in its earning statement.
 
It reported earnings of 16 cents per share and revenue of $710 million. Twitter said it expects between $595 million and $610 million in revenue for the first quarter, compared to the estimates of $629 million.
 
Still, revenue was up 48 percent year-over-year despite stalled user growth, the report added.
 
"Positive impacts from our marketing initiatives which contributed meaningfully to MAU growth. However, these were more than offset by organic declines, partially due to fourth quarter seasonal trends."
 
In the past year, the stock has fallen nearly 70 percent and investors are looking for long-term growth from Twitter.
 
"Not being able to add any new active users in the last quarter will disappoint some, particularly investors. Yet it did see active advertisers go up by almost 90 percent year-on-year," said Sotirios Paroutis, associate professor with the Warwick Business School.
 
"Plus, historically, Q4 has been a slow quarter for Twitter. While in 2016 the US elections and the Olympics will be two big events that are expected to help push their active users up," said Paroutis, who specialises in strategic management and specifically researches Twitter.
 
"Twitter has delivered a number of product innovations, but these need to be less confusing for core users and attractive enough for new users. The focus on 'live' and experiencing live events is a clear effort to explain Twitter to a wider audience."
 
Now, in an attempt to bring tweets to more people across the globe, Twitter is planning to introduce an algorithmic timeline like Facebook. The timeline will reorder tweets based on what Twitter's algorithm thinks people most want to see.
 
The home timeline will be rolled out to people across 23 countries, including India, who visit Twitter homepage on their mobile devices. The micro-blogging site has been looking for ways to elevate popular content for quite some time.
 
An algorithmic feed would be, to date, the boldest change so far under Jack Dorsey, who took the reins of Twitter as new CEO in October last year, analysts maintain.
 
Dorsey has made several moves, including cutting jobs and naming Google's former chief business officer, Omid Kordestani, as Twitter's executive chairman.
 
Under Dorsey, Twitter has released a news curation feature "Moments" and the company is reportedly working to extend Twitter's identifying 140-character limit to 10,000.
 
Twitter is also set for a major overhaul under Dorsey to revive the company's fortune with some of the high-profile executives putting in their papers.
 
According to a report in the Wall Street Journal, the company's head of engineering Alex Roetter and product chief Kevin Weil are departing, along with Katie Stanton, the company's high-profile head of media who had informed the company of her intention to quit some time back.
 
Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.

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Now, France asks Facebook to stop sending user data to US
London : In another setback to Facebook in Europe, the French data protection authority has ordered the social networking giant to stop sending user data to the US and comply with the European data protection law.
 
According to a report in technology website Tech Crunch, Facebook has been given three months to make the changes deemed necessary by the data protection authority CNIL and failing to do so will incur heavy fines.
 
Specifically, the data protection agency is unhappy that Facebook collects the browsing activity of internet users who do not have a Facebook account.
 
“The company does not inform Internet users that it sets a cookie on their terminal when they visit a Facebook public page (page of a public event or of a friend). This cookie transmits to Facebook information relating to third-party websites offering Facebook plug-ins (e.g. Like button) that are visited by Internet users,” the CNIL notice read.
 
According to the notice, Facebook collects user data concerning sexual orientation, religious and political views “without the explicit consent of account holders”. Nor does it inform users on the sign up form “with regard to their rights and the processing of their personal data”.
 
Facebook is also accused of using the now illegal “Safe Harbor” data transfer mechanism - a longstanding trans-Atlantic data transfer agreement that was invalidated by the European Court of Justice last year, the report added.
 
According to a Facebook spokesperson, “We are confident that we comply with European Data Protection law and look forward to engaging with the CNIL to respond to their concerns.”
 
According to CNIL, it has made its notice against Facebook public due to “the seriousness of the violations and the number of individuals concerned by the Facebook service”.
 
Facebook has more than 30 million users in France.
 
The social networking giant is facing several privacy-related probes in Europe.
 
In November, a Belgian court ordered the company to stop using cookies to track the web activity of its users.
 
As well as investigations by the French and Belgian authorities, Facebook is also being probed by Spanish, Dutch and German (Hamburg) data protection authorities.
 
Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.

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Red Cross Donations Plummet and Deficit Spikes

The charity has its worst fundraising year since at least 2000

 

The American Red Cross ran a deficit of $159 million last fiscal year, battered by a steep drop in fundraising and its struggling blood banking division, according to newly released financial statements.

 

Former AT&T executive Gail McGovern, who was hired as CEO in 2008 with a brief to stabilize the charity's finances, has spent the last eight years making deep cuts in the Red Cross' workforce and trying to bring in more donations with an increased focus on branding.

 

But the new financial statements show contributions to the Red Cross fell to $604 million, about $120 million less than the previous year. It is the worst fundraising result the Red Cross has had since at least 2000, the last year for which we could find financial records.

 

The Red Cross' fundraising can swing wildly, spiking when there's a major disaster and dropping in years with no big televised catastrophe. But there have been no signature disasters in either of the past two years, raising the question of why donations dropped so much.

 

A Red Cross spokesperson declined to comment in response to questions about its financial results.

 

In a letter to a congressman last month, McGovern says she presided over "Turnaround I" after inheriting financial problems at the charity in 2008 and that she is now in the midst of "Turnaround II" as a result of a drop in demand for blood.

 

The Red Cross' large blood banking division, which has been struggling amid industry-wide declines and other issues, lost $71 million in 2015.

 

McGovern also wrote in the letter that fundraising is actually improving, but the charity has not provided data to substantiate the claim.

 

McGovern wrote that donations have increased "14 percent since 2008" if major disasters are excluded. It's not clear how the group is arriving at the figure. It declined our request for details on the calculation.

 

The group's revenue in 2015 was also hurt by a decline in contributions from the United Way and other federated sources, which fell from $104 million to $77 million. A United Way spokesperson told us it has cut contributions to the Red Cross in recent years because it has shifted to a "community impact funding model."

 

While the Red Cross' audited financial statements show a $159 million deficit for last fiscal year, McGovern last month cited an "operating deficit" of just $36 million for the year. The charity previously said that it created a concept of "operating" surpluses or deficits that "reflect Red Cross performance in managing our day-to-day revenues and expenses." But it's impossible to tell where that figure comes from because the group has declined to show its calculations.

 

If you have information about the Red Cross 2014 or any other tips 2014 please email [email protected].

 

ProPublica is a Pulitzer Prize-winning investigative newsroom. Sign up for their newsletter.

 

 

 

 

 

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