Without a doubt outbreak of deadly coronavirus has and continues to affect the entire world in worst ways no one would have ever imagined. The effects of this epidemic are being felt in each sector of any given economy in the entire world.
Widely used social media network Twitter Inc. (TWTR) has not been left out by this catastrophe, the company has announced dropping its initially released financial guidance for the first quarter of 2020 due to the coronavirus pandemic.
Twitter said it has pulled its earnings and revenue estimates which it had prior given.
Ironically, the company says number active users on the social media app has increased significantly since breakout of the coronavirus however, the company projects generating net losses in the first quarter despite the increase in daily active users on its platform.
“We’re seeing a meaningful increase in people using Twitter,” said the company’s CEO Jack Dorsey.
Twitter’s Chief Financial Officer, Ned Segal, claims they have been losing advertisers due to market uncertainties coming along with the coronavirus situation. The CFO says since many businesses are on their lowest without any signs of businesses of returning back to normalcy soon many advertisers consider it unwise to advertise at such time.
Another factor clients are shying away from advertising is that they fear to advertise when everything around the world is now about coronavirus and there businesses could be linked to the coronavirus situation in one way or another.
“The COVID-19 impact began in Asia, and as it unfolded into a global pandemic, it has impacted Twitter’s advertising revenue globally more significantly in the last few weeks,” said Segal.
Other players in the technology sector including Facebook Inc. (FB) and Alphabet Inc. (GOOGL) are also feeling the heat from this pandemic. Last week, while on an interview with Bloomberg TV, Facebook’s Chief operating Officer, Sheryl Sandberg, acknowledged things won’t be as usual. Nonetheless, he also recognized the technology sector might experience some gains through current situation.
“This is not going to be business as usual, and the marketing industry is certainly going to see a real impact. I don’t think anyone knows how big. So we’re going to watch and look,” said Sandberg.