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Twitter Bans Alex Jones & Infowars After Dorsey’s Testimony


Twitter TWTR recently announced that it has banned “right-wing conspiracy theorist” Alex Jones and his website Infowars from the platform as well as from Periscope, its live video streaming application. Twitter’s move follows that of Apple AAPL, Alphabet’s GOOGL YouTube and Facebook FB, which previously prohibited Jones’ channels and related videos.

Notably, the news came a day after Twitter’s CEO Jack Dorsey testified in front of the members of Congress along with Facebook’s COO Sheryl Sandberg. Dorsey was questioned about Twitter’s measures to curb the proliferation of fake news on its platform ahead of the 2018 US mid-term elections.

Twitter’s action of banning Jones in a scenario like this seems appropriate as the social media platform provider is ramping up its efforts to make sure that the platform is not involved in any sort of manipulation related to the election results.

Twitter imposed a seven-day ban on Alex Jones and Infowars in the previous month for violating platform policies against abusive behaviour. The repetition of a similar act from Jones’ end with the posting of a video prompted Twitter to ban him and the related website permanently.

Notably, Jones had a massive follower base of around 900,000 and Infowars had around 430,000 followers. The move won accolades from Frank Pallone, the New Jersey Democratic Representative.

These initiatives are expected to boost investors’ confidence in the stock further. Notably, Twitter stock has gained 76.6% over the past year, outperforming the industry’s gain of 37.8%.

Twitter’s Overall Performance

Twitter has been benefiting from rising number of mobile users and its strategic acquisitions. Moreover, the recent spate of live streaming deals looks promising.

Twitter reported second-quarter 2018 non-GAAP earnings of 17 cents per share, in line with the Zacks Consensus Estimate but better than 8 cents reported in the year-ago quarter. Revenues of $711 million increased 24% from the year-ago quarter and beat the consensus mark of $700 million.

In second-quarter 2018, Twitter’s adjusted monthly average users (MAUs) totalled 335 million, up from 326 million in the year-ago quarter but down 1 million sequentially. U.S. MAUs of 68 million decreased 1 million sequentially but remained flat on a year-over-year basis. International MAUs of 267 million increased 9 million from the year-ago quarter but remained flat sequentially.

Twitter's slowing user base is a concern for investors. Since the company is significantly dependent on advertising, a slowing user growth rate amid increasing competition for ad dollars from much larger players like Facebook and Google does not bode well for the stock. Further, increasing investments in product development and costs related to international expansion will remain an overhang on profitability.

Nevertheless, the company is benefiting from strong growth in international market. Twitter remains focused on boosting user growth rate and engagement levels through various measures like making tweeting easier for people and more expressive. These factors are expected to help improve this Zacks Rank #3 (Hold) company’s user growth rate going forward.

You can see the complete list of today’s Zacks Rank #1 (Strong Buy) stocks here.

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