1 Twitter share price plummets 12% (Dominic Rushe in The Guardian) Twitter’s share price dropped sharply on Wednesday after its first results as a public company prompted concerns among investors that its rapid growth was running out of steam.
In its first quarterly earnings report since going public, Twitter revealed that it had more money than in the last three months of 2013 than analysts expected. But shares fell sharply as the company announced it had 241m users at the end of 2013, just 9m higher than the previous quarter. Twitter also disclosed that the number of “timeline views” – its equivalent of page views, and a key measure for advertisers – dropped for the first time in the last quarter of 2013 to 148bn from 159bn.
According to the earnings report, in the three months to 31 December, the company had revenues of $242.7m, an increase of 116% compared to $112m in the same period last year. It made a net loss of $511m for the fourth quarter of 2013, compared to a net loss of $9m in the same period last year. Twitter said it expected first-quarter revenue to be in the range of $230m to $240m, with revenue for the year of between $1.15bn and $1.2bn, nearly double the $665m it posted in 2013.
Twitter is still growing quickly. The disappointing quarterly figures still represents a 30% rise year on year. But it accounts for a very small portion of the overall digital ad market. Twitter accounted for 0.5% of global digital ad revenues in 2013, according to eMarketer, up compared to 0.3% in 2012. Facebook, by comparison, accounts for 5.7% of global digital ad spending. Google accounts for 32.4%.
2 Young fared worst in recession (Angela Monaghan in The Guardian) Young people in Britain have borne the brunt of the financial crisis, with a larger proportion of 16- to 24-year-olds now out of work than any other age group. The unemployment rate among 16- to 17-year-olds is 35.9%, and 18% among 18- to 24-year-olds, according to the Office for National Statistics in its latest economic review. In contrast the rate falls to 4.7% among 35- to 49-year-olds, and 4.4% among 50- to 64-year-olds.
Those aged between 18 and 24 accounted for almost 30% of the rise in the unemployment rate between the first quarter of 2008 and the peak in unemployment in the fourth quarter of 2011, roughly double their proportion of the labour force. Over that period the overall jobless rate rose from 5.2% to 8.4%.
Older workers have fared relatively better during the crisis. People aged 35 to 49 make up a bigger proportion of the UK workforce, at just over a third, but only accounted for about 20% of the increase in the jobless rate over the period.
3 Facebook’s struggle to keep its friends (Harry Wallop in Sydney Morning Herald/Telegraph) America has, since its earliest days, been the crucible of great fortunes created within a lifetime. Cornelius Vanderbilt, John D. Rockefeller and Andrew Carnegie all died richer than Croesus, each owning the equivalent of more than $150 billion (in today’s money) after recognising the world-changing potential of railroads, oil and steel.
But another name needs to be added to this pantheon: Mark Zuckerberg, who has yet to touch their stratospheric wealth, but who has established an empire with a dizzying speed that would make even these great men envious. On Tuesday Facebook, which he dreamt up in his Harvard dorm with a couple of other students, celebrated its 10th birthday.
In that short time (Zuckerberg is only 29), the website has helped to redefine how a generation goes about its daily life. Facebook’s scale is hard to fathom. There are 1.23 billion users – half of the world’s population with internet access. Some 750 million use Facebook daily. Every day 350 million new photos are uploaded to the site and, says Lou Kerner, founder of the Social Internet Fund, “more than 20 per cent of all time spent on the internet is spent on Facebook”.
After initial doubts about how it would make any money, its sharemarket valuation passed $150 billion last week, cementing Zuckerberg’s wealth at $30 billion. But its success has led, in recent months, to fears that it may be due for a tumble, that in another 10 years we will talk about it as we now talk about MySpace and Bebo – once huge websites that died a death. A report by Princeton University researchers suggested Facebook would lose 80 per cent of its users by 2017. Comparing the site to a virus, it said Facebook had “already reached the peak of its popularity and has entered a decline phase”.
Its future lies in ensuring it makes lots of money from users by encouraging them to come back as often as possible. Already, 61 per cent of monthly users visit daily, up from 55 per cent in 2012. That is loyalty many websites would kill for. Perhaps its greatest opportunity lies in developing the internet for the world’s 4.5 billion people now offline. “This is a huge untapped market,” says Stuart Miles, founder of the Pocket-lint website. “If they can get a pared-down Facebook on to less sophisticated smartphones that will be a huge deal.”