Twitter Inc. (NYSE:TWTR) stock was down 0.4% in mid-afternoon trading on August 17. Shares of Twitter plunged following the release of its second-quarter results on July 27. Monthly active users (MUAs) edged down and earnings per share remained flat year over year.
Social media giants have been under intense pressure from politicians and those in the intelligence community to eliminate what are viewed as damaging voices. This pressure began in the aftermath of the 2016 U.S. election as these same entities claimed that Russian meddling played a key role in the U.S. election. Facebook CEO Mark Zuckerberg expressed skepticism when the accusations were originally levied against his platform, but quickly toed the line as pressure increased.
The most notable event of the past two weeks was the purging of the media platform InfoWars and its owner Alex Jones from Facebook, Apple, Spotify, and Youtube. Twitter CEO Jack Dorsey came under scrutiny for failing to follow suit. He defended his position and stated that Jones had not violated Twitter’s user policy. Twitter has since suspended Alex Jones’ Twitter account for a seven-day period.
Investors have seen Facebook’s monthly active users suffer since it has enacted constricting changes to its platform. This has included funneling users to "authoritative content" in order to prevent the dissemination of "fake news". The Q2 report from Twitter shows that its platform could also see a dip in its MUA.
Social media giants are going to be under intense pressure from all sides of the political aisle ahead of the November midterms and what promises to be a ferocious 2020 Presidential election. This is likely to produce volatility in the near term for stock valuations.
