*By Michael Teich* It's "mind-boggling" that Wall Street didn't foresee the decline of Twitter's user base, said Pivotal Research analyst Brian Wieser. "This has been more than telegraphed," and the "stock was widely overvalued" going into earnings, he added. Twitter shares plunged after the company reported 335 million monthly active users, 1 million fewer than the company had in the previous quarter. Twitter attributed the decline to its efforts to clean up the platform and purge spam accounts as well as the impact of GDPR, the new European Union law on data protection and privacy. In its shareholder letter, Twitter said it expects a third-quarter decline of "mid-single-digit millions of monthly active users." Although Wieser has a "sell" rating on Twitter stock, he thinks there were some positives that emerged from the quarterly report. He said that investors are overvaluing the importance of monthly active users. "Monthly active users are irrelevant commercially," he said. "Advertisers are the ones spending money, not users." By the same token, advertisers were seemingly unfazed by the drop in MAUs. Twitter's ad revenue grew 23 percent to $601 million in the second quarter. Overall revenue of $711 million topped estimates of $696.2 million, and earnings per share were in line with expectations. Wieser is optimistic about Twitter's efforts to kill the spam and fake accounts plaguing the platform. Twitter suspended more than 70 million accounts in May and June, but Twitter CFO Ned Segal said most of them were not included in the company's reported metrics. For full interview, [click here] (https://cms.cheddar.com/videos/VmlkZW8tMjEyNDg=).
