Today: As Twitter falls to all-time lows, Yelp gets a post-earnings bump and Facebook gains while showing off new initiatives. Also: Dow hits record despite weak economic growth, eBay dives.
The Lead: Social media stocks volatile as earning reports arrive
Silicon Valley's social-media companies continued to face volatility in the stock market Wednesday, as Yelp gained after its earnings report and Facebook clocked an increase while showing off new mobile efforts while Twitter plummeted to new lows.
Yelp was the latest to step up to the earnings podium, and the San Francisco online-reviews company showed off continued steep sales growth and increased its projections for 2014 revenues.
"We had a great start to the year and are excited about the large opportunity ahead of us. Yelp is becoming the gold standard in local search," Yelp co-founder and CEO Jeremy Stoppelman said in Wednesday's announcement.
Yelp reported a net loss of $2.64 million, or 4 cents/share, on sales of $76.4 million, which put year-over-year revenue growth at 66 percent, in line with 2013's 69 percent sales growth. For this year, Yelp increased its revenue forecast to a range of $363 million to $367 million, which would mean minimum sales growth of 56 percent.
Yelp shares closed with a 1 percent decrease to $58.32, but rebounded to top $60 in late trading after the report was released; the company's stock has dropped more than 40 percent from its peak price of more than $100 reached earlier this year.
Facebook gained 2.8 percent to $59.78 Wednesday as founder and CEO Mark Zuckerberg kicked off the Menlo Park company's f8 developers conference with a keynote that included news on anonymous Facebook sign-ins for mobile applications and a new mobile-ad network.
"We have to do everything we can to put people first," Zuckerberg said. "People want more control over how they share their information, especially apps."
Facebook rival Twitter was not as fortunate, falling to its lowest prices as a public company after showing off better-than-expected earnings Tuesday but suffering from a perceived slowdown in user growth.
Analysts dropped price targets Wednesday morning, reflecting their doubts about the company's ability to grow beyond a niche service, as Facebook, which has about a billion more active users than Twitter's 255 million, was able to do.
"Twitter's user growth speaks again to how the platform is still in its infancy ... and how it has a much more niche use case than Facebook," Susquehanna Financial Group analyst Brian Nowak wrote in a note, while dropping his price target from $48 to $38. "We like Twitter's advertising progress, but over time, expanding the user base will be important to Twitter's efforts to increase its share of ad budgets," he later added.
Social media's week in the earnings spotlight will draw to a close Thursday afternoon, when Mountain View professional-networking service LinkedIn is scheduled to release its quarterly earnings report.
SV150 market report: Dow closes at record high despite weak GDP
Wall Street moved slightly higher Wednesday, pushing the Dow Jones industrial average to a record high despite a disappointing measure of gross domestic product in the United States, more bond-spending cuts from the Federal Reserve and a post-earnings slump from eBay.
eBay dropped 5 percent to $51.83 after announcing earnings Tuesday, which included taking a $3 billion charge for the repatriation of $9 billion in overseas cash, which some sources pontificated Wednesday was a precursor to a large acquisition, with San Francisco payments company Square most prominently mentioned. The San Jose e-commerce giant didn't rest on its laurels while its stock dipped, though: PayPal, the company's payments arm that until recently was targeted for a spinoff by activist investor Carl Icahn, announced an unprecedented marketing effort that includes a new logo. "The perception hasn't caught up with the reality of what PayPal is today," PayPal president David Marcus told Bloomberg News. "In the past we've never done any massive advertising campaigns." Additionally, eBay ticket-broker service StubHub announced that it would begin hosting its own concerts, including a series with which it will partner with Oakland streaming-music company Pandora Media.
Hewlett-Packard gained 0.3 percent to $33.06 after announcing a new effort to produce cloud-ready data-center servers in partnership with Asian manufacturing giant Foxconn. Oracle jumped 1.9 percent to $40.88 after founder and CEO Larry Ellison's interest in buying the Los Angeles Clippers NBA team was made public Wednesday morning. Santa Clara software firm Intuit moved 0.5 percent higher to $75.75 after the Wall Street Journal reported that it was in negotiations to buy Palo Alto mobile startup Check for more than $350 million.
Up: Gilead, Facebook, VMware, Zynga, Oracle, Salesforce, Juniper, AMD, Adobe, SolarCity, Electronic Arts, Intel, Netflix, Symantec, NetApp, Tesla, Intuit
Down: Twitter, eBay, Pandora, Splunk, Ruckus, Nvidia, Yelp, Apple, Workday, Google, Cisco
The SV150 index of Silicon Valley's largest tech companies: Up 4.02, or 0.29 percent, to 1,394.46
The tech-heavy Nasdaq composite index: Up 11.01, or 0.27 percent, to 4,114.56
The blue chip Dow Jones industrial average: Up 45.47, or 0.27 percent, to 16,580.84
And the widely watched Standard & Poor's 500 index: Up 5.62, or 0.3 percent, to 1,883.95
Check in weekday afternoons for the 60-Second Business Break, a summary of news from Mercury News staff writers, The Associated Press, Bloomberg News and other wire services. Contact Jeremy C. Owens at 408-920-5876; follow him at Twitter.com/jowens510.