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Millions flock to Twitter, but tech giant loses £940m

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millions flock to twitter but tech giant loses 940m

Tens of millions of new users flocked to Twitter because of the pandemic and the Black Lives Matter protests – but profits took a nosedive as businesses reined in their spending on advertising. 

Daily usage on the social media platform jumped by 34 per cent in the three months to the end of June compared with the previous year, the biggest quarterly spike in Twitter’s history. 

But the economic impact of the pandemic has also made advertisers more nervous about spending, sending Twitter’s second quarter revenues down from £662m to £537m. 

High profile: Accounts of users including (clockwise from top left) Elon Musk, Barack Obama, couple Kim Kardashian and Kanye West and Joe Biden were hacked

High profile: Accounts of users including (clockwise from top left) Elon Musk, Barack Obama, couple Kim Kardashian and Kanye West and Joe Biden were hacked

High profile: Accounts of users including (clockwise from top left) Elon Musk, Barack Obama, couple Kim Kardashian and Kanye West and Joe Biden were hacked

That was short of the £552m expected by Wall Street analysts. 

The US company reported an overall loss of £940m for the quarter, compared with an £870m profit the previous year. As well as the impact of the virus, it was also hit by an £857m tax charge. The red ink came as boss Jack Dorsey apologised for an embarrassing incident last week that saw hackers tweet from the accounts of highprofile users including Elon Musk, Barack Obama, Joe Biden, Kim Kardashian and Kayne West.

‘Last week was a really tough week for all of us at Twitter,’ Dorsey, 43, said during a call with analysts. Twitter had 186m daily users in the second quarter, up from about 139m previously. 

New tweeters have been flocking to the platform as they self-isolated during the pandemic. The Black Lives Matter protests on both sides of the Atlantic also drew people to Twitter to express their views. 

Despite the influx of users, Twitter’s advertising business continued to suffer in the second quarter. 

Revenues plunged 27 per cent in the last three weeks of March when the lockdown was imposed. A ‘gradual, moderate recovery’ in April proved to be short-lived as many advertisers put the brakes on spending once again in late May to mid-June. Jasmine Enberg, an analyst at information provider Emarketer, said Twitter’s ‘strength as a news and entertainment source’ had helped to buoy the network during the pandemic’.  

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Retail sales rise for fourth month as economy shows signs of recovery

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retail sales rise for fourth month as economy shows signs of recovery

Households continued to splash out last month as the economy showed signs of recovery after lockdown.

Retail sales rose by 0.8 per cent in August, according to the Office for National Statistics, putting them 4 per cent above pre-pandemic levels.

It was the fourth month of rising sales in a row – boosted by demand for DIY products and other household goods.

Retail sales rose by 0.8 per cent in August, according to the Office for National Statistics, putting them 4 per cent above pre-pandemic levels

Retail sales rose by 0.8 per cent in August, according to the Office for National Statistics, putting them 4 per cent above pre-pandemic levels

Retail sales rose by 0.8 per cent in August, according to the Office for National Statistics, putting them 4 per cent above pre-pandemic levels 

But Jonathan Athow, deputy national statistician for economic statistics at the ONS, said: ‘Overall, the switch to greater online sales means the High Street remains under pressure.’

The ONS report showed that online sales are 46.8 per cent up since February.

There has also been strong demand for household goods – up 9.9 per cent since February – as families carried out home improvements.

With fresh restrictions across England being considered again, industry figures yesterday warned they could be in for more pain.

Helen Dickinson, chief executive of the British Retail Consortium, said retailers were in ‘a period of fragile recovery’.

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Shares tank on fears of another lockdown within weeks

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shares tank on fears of another lockdown within weeks

Shares in companies that would suffer in a second lockdown plunged as ministers warned ‘circuit-break’ restrictions could come into force within weeks.

Firms in every corner of the economy were hit by the warnings with airlines, engineering groups and banks leading the fallers.

Prime Minister Boris Johnson said the UK was ‘seeing the start of a second wave’ of the pandemic as another 4,322 coronavirus cases and 27 deaths were reported in the UK.

33354086 8748953 image m 18 1600458890631

33354086 8748953 image m 18 1600458890631

Warning: Prime Minister Boris Johnson said the UK was ‘seeing the start of a second wave’ of the pandemic as another 4,322 coronavirus cases and 27 deaths were reported in the UK

The Government is now considering a partial ‘circuit-break’ lockdown for two or more weeks across the whole of England, which could include asking some hospitality businesses to close and limiting the opening hours of some pubs and restaurants nationwide. 

But business leaders have warned that another lockdown could ‘cripple’ the already-fragile economy just as it has started to recover.

Hannah Essex, co-executive director of the British Chambers of Commerce, said: ‘While protection of public health must be the priority, government should do everything in its power to avoid further national lockdowns that will cripple businesses.’

Ryanair grounds flights 

Ryanair will further reduce its operations due to coronavirus travel restrictions.

The budget airline said its capacity in October will be 40 per cent of 2019 levels, compared with the 50 per cent it previously announced. 

The firm said it expects to fill 70pc of seats on its planes. A Ryanair spokesman said: ‘While it is too early yet to make final decisions on our winter schedule (from November to March), if current trends and EU governments’ mismanagement of the return of air travel and normal economic activity continue, then similar capacity cuts may be required across the winter period.’

It is thought the restrictions will come in over the half-term break – which would dash any hopes of an autumn holiday for families.

It would also threaten weakening consumer confidence even further at a time when the economy was getting back to normality.

Shares in British Airways-owner IAG plunged 14.6 per cent, or 18.9p, to 110.55p, making it the largest faller on the FTSE 100 index.

Holiday Inn-owner Intercontinental Hotels Group tumbled 4.5 per cent, or 194p, to 4137p, while Premier Inn-owner Whitbread slid 2.4 per cent, or 53p, to 2200p.

On the FTSE 250 Easyjet slumped 9.2 per cent, or 54.6p, to 539.6p, while cruise operator Carnival sank a further 7.9 per cent, or 81.4p, to 947.6p. 

Travel and tourism companies have been among the hardest hit in the crisis after the pandemic brought global air travel virtually to a standstill through spring and the early summer. 

Airlines were further pummelled by confusing and last-minute quarantines being imposed on many popular summer holiday destinations – and are now having to row back their tentative autumn schedules even further.

Russ Mould, investment director at AJ Bell, said: ‘The Government wants to avoid economic disruption, but clearly a return to tighter lockdown measures next month would disrupt businesses and put further pressure on jobs.’

Shares in British Airways-owner IAG plunged 14.6 per cent, or 18.9p, to 110.55p, making it the largest faller on the FTSE 100 index

Shares in British Airways-owner IAG plunged 14.6 per cent, or 18.9p, to 110.55p, making it the largest faller on the FTSE 100 index

Shares in British Airways-owner IAG plunged 14.6 per cent, or 18.9p, to 110.55p, making it the largest faller on the FTSE 100 index

Engineering groups that supply airlines with parts and engines were also put under pressure.

Shares at Rolls-Royce dived 5.1 per cent, or 9.75p, to 180.15p, while GKN-owner Melrose fell 3.4 per cent, or 4.25p, to 120p.

Michael Hewson, chief market analyst at CMC Markets UK, said: ‘The continued reduction by airlines to their flight schedules puts more pressure on Rolls-Royce’s cash flow as they get paid in line with how much time aircraft are actually in the air.’

Kate Nicholls, the boss of UK Hospitality, said the sector was still on a ‘knife edge’.

Wagamama-owner The Restaurant Group lost 2.4 per cent, or 1.35p, to close at 54.65p, while train station and airport café operator SSP fell 3.1 per cent, or 6.2p, to 196.2p.

There was further pressure on banks after traders were spooked this week by talk of negative interest rates. Fears are rising that negative interest rates might be one of the only policy tools left in politicians’ arsenals to fight Covid.

HSBC ended down 2.2 per cent, or 6.8p, at 304p last night, while Lloyds fell 3.9 per cent, or 1.01p, to 25.24p, and Natwest fell 3.2 per cent, or 3.17p, at 96.88p.

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Covid-hit Gemfields plunges to £50m loss

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Gemfields swung to a loss as Covid-19 shut its mines and cancelled crucial gem auctions.

The Faberge owner and precious stones miner, which has counted celebrities such as actor Mila Kunis (pictured) among its celebrity ambassadors, said turnover had tumbled 83 per cent to £16million in the first six months of the year. 

And the ruby and emerald specialist racked up a loss of £50.1million, down from a profit of £16million in the same period of last year. 

Sales slump: Faberge-owner Gemfields, which has counted celebrities such as actor Mila Kunis (pictured) among its celebrity ambassadors, said turnover had tumbled 83 per cent

Sales slump: Faberge-owner Gemfields, which has counted celebrities such as actor Mila Kunis (pictured) among its celebrity ambassadors, said turnover had tumbled 83 per cent

Sales slump: Faberge-owner Gemfields, which has counted celebrities such as actor Mila Kunis (pictured) among its celebrity ambassadors, said turnover had tumbled 83 per cent

Between January and June it only managed to hold one gemstone auction, in Zambia, where it raised £9million selling emeralds. 

It is trying to arrange online auctions but is not sure when this will be up and running. And it has scrapped financial guidance as a result of the pandemic’s hit.

The company has been forced to write down the value of its Faberge arm by £9million, after seeing a ‘significant reduction’ in sales as well as a ‘less positive outlook on the global luxury goods and retail sectors’.

The torrid six months included rejoining the London Stock Exchange’s junior market on Valentine’s Day.

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