3 social media stocks nosedived this week. Here’s why


Several social media heavyweights disappointed shareholders this week by reporting weak first quarters while lowering their outlooks. Their stock prices sank amid the bad news.

Among those that came up short were Twitter [fortune-stock symbol=”TWTR”], Yelp [fortune-stock symbol=”YELP”], and LinkedIn [fortune-stock symbol=”LNKD”]. What went wrong? Fortune breaks it down.


Twitter shares plummeted around 20%. Courtesy of Fortune.com

Misfire: Twitter reported revenue of $436 million, a 74% gain from a year ago. However, the company fell short of the $457 million that analysts had expected and missed its own guidance of $440 million to $450 million.

Fortune take (via @eringriffith):

The company’s biggest weakness, in the eyes of investors, is that it isn’t adding new users as fast as they would like. For the past year, CEO Dick Costolo has been touting product improvements meant to increase engagement and lure lapsed users back to the service, but the…

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