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Twitter Sinks After Analyst Flags Accounting ‘Smoke and Mirrors’

A monitor displays Twitter Inc. signage on the floor of the New York Stock Exchange.

A monitor displays Twitter Inc. signage on the floor of the New York Stock Exchange.

Photographer: Michael Nagle/Bloomberg

Twitter Inc. shares are sliding after one Wall Street bear rang the alarm on the firm’s spending, flagging “smoke and mirrors on the cost line.”

In the first two quarters of the year, the company reported 0 percent and 3 percent operating-expense growth, respectively -- surprisingly low given issues with regulators and competition, MoffettNathanson founding partner Michael Nathanson wrote in a note to clients Monday. But the analyst thinks there may be more to those numbers than meets the eye.