Earnings Season is off to a rough start for major tech companies, with many missing on key metrics that caused the Technology Select Sector SPDR Fund (XLK) to drop more than 3.2% from last week highs.
While both Amazon (AMZN) and Google’s parent, Alphabet (GOOGL), crushed analyst estimates on earnings per share for the quarter ($5.07 vs $2.50 expected and $11.75 vs $9.59 expected, respectively), other companies did not fare as well.
Shares of Facebook (FB) slid more than 20% after the company reported disappointing second-quarter results, missing earnings expectations for the first time in three years. Notably, the company added only 22 million users worldwide, which was the lowest quarter-over-quarter jump since 2011. Additionally, Facebook’s daily active users in Europe declined from 282 million to 279 million during the quarter. Facebook currently sits at 174.89 and a $624 billion market cap.
The story was much the same with Twitter (TWTR), which saw its shares plunges nearly 21% after reporting a decline in users. The company’s monthly average users worldwide in the second quarter fell to 335 million, down 1 million from the first quarter and a miss on the 339 million Wall Street estimate.
Twitter also noted that it expects another drop in users in the mid-single-digit millions in the third quarter while also anticipating growing costs due to its investment in the company’s platform. Twitter currently sits at $34.12 and a $26.5 billion market cap.
While social media platforms are struggling to retain its user growth, professional social network LinkedIn reported significant quarterly gains. The company, which was acquired by Microsoft (MSFT) for $26.2B in 2016, showed a 41% increase in user sessions from its 575 million registered members, which is up from 467 million in September 2016.
Snap Inc. (SNAP) is expected to report earnings on Aug. 7 after market close.