When Meta Platforms (NASDAQ:META) rolled out Threads, it looked like it might actually have a Twitter killer on its hands. Users flocked to the new platform to investigate it more thoroughly and see if it could be a platform for stardom or at least better sales. But the gild is coming off the lily, and users are reconsidering adding one more tool to their already-stuffed social media lineup. Meta itself is down significantly in Friday afternoon’s trading as a result.
Pick the best stocks and maximize your portfolio:
- Discover top-rated stocks from highly ranked analysts with Analyst Top Stocks!
- Easily identify outperforming stocks and invest smarter with Top Smart Score Stocks
There certainly was a surge in signups, noted a Wall Street Journal report. But that surge didn’t last, as daily active user counts began a precipitous fallout that lasted for at least the last two weeks. The peak seen on July 7 has now crumbled, and users are down about 70% from that high-water mark. About as bad, the average time spent on the app is also in decline. That’s led to Meta staffers scrambling to add new features in a bid to stop hemorrhaging users.
Worse, there are other problems in the wings for Meta’s new tool. Regulators are scrutinizing the new platform accordingly, particularly as it relates to moderating content. Some investors are even starting to wonder how Meta will actually make money with Threads. This led to CEO Mark Zuckerberg coming out and noting in CNN Business that “the rest of the year” is about user retention and building up the basics. Given the sheer decline seen so far, Meta will have its work cut out for it.
Analysts, however, are confident that Meta will pull through. With 36 Buy ratings and three Holds, Meta Platforms stock is considered a Strong Buy by analyst consensus. Further, with an average price target of $324.34, Meta Platforms stock offers its investors a 10.04% upside potential.
