Twitter Inc (TWTR) Stock Crashes After Earnings Report

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Twitter Inc (NYSE:TWTR) released the results from its most recently completed quarter, hitting break-even on a non-GAAP earnings per share basis and posting losses of 23 cents per share on a GAAP basis. Revenue grew 119% year over year to $250 million for the first quarter. On average, analysts had been expecting the micro-blogging company to post losses of 3 cents per share on $4.23 billion in revenue for the quarter.

Twitter investors focus on users

Perhaps the more important number is the number of monthly active users, which was 255 million, a 25% increase year over year. Analysts and investors have been especially focused on user growth, which was Twitter’s weakest area in the last earnings report.

The company reported 198 million mobile monthly active users, a 31% increase. Mobile users made up 78% of total users. Twitter Inc (NYSE:TWTR) reported 157 billion timeline views, a 15% increase, and $1.44 in advertising revenue per thousand timeline views. That’s a 96% increase year over year.

Breaking down Twitter’s results

Of Twitter Inc (NYSE:TWTR)’s total revenue, advertising revenue rose 125% to $226 million. Mobile advertising revenue made up about 80% of that amount. The company reported $24 million in data licensing and other revenue, a 76% increase. International revenue increased 183% to $70 million and made up 28% of the company’s total revenue.

Twitter Inc (NYSE:TWTR)’s GAAP net loss widened year over year from $27 million last year to $132 million this year. That included $126 million in stock-based compensation. The company reported $37 million in adjusted EBITDA, compared to $12 million in the same quarter a year ago.

Twitter provides guidance

Twitter Inc (NYSE:TWTR) projected revenue to be between $270 million and $280 million for current quarter. The company estimates that adjusted EBITDA will be between $25 million and $30 million and that stock-based compensation expenses will be between $170 million and $180 million, excluding equity awards which could be granted as part of future acquisitions.

For the full year, Twitter Inc (NYSE:TWTR) projects revenue of between $1.2 billion and $1.25 billion and adjusted EBITDA of between $180 million and $205 million. The company expects to spend between $330 million and $390 million on capital expenditures and between $640 million and $690 million on stock-based compensation, excluding equity awards that are part of future acquisitions.

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About the Author

Michelle Jones
Michelle Jones was a television news producer for eight years. She produced the morning news programs for the NBC affiliates in Evansville, Indiana and Huntsville, Alabama and spent a short time at the CBS affiliate in Huntsville. She has experience as a writer and public relations expert for a wide variety of businesses. Michelle has been with ValueWalk since 2012 and is now our editor-in-chief. Email her at Mjones@valuewalk.com.

1 Comment on "Twitter Inc (TWTR) Stock Crashes After Earnings Report"

  1. The above article discusses “monthly active users,
    which was 255 million, a 25% increase year over year: Analysts and
    investors have been especially focused on user growth…”

    OK – how does an investor verify how many actual users are on twotter?

    I mean, does twotter have an accountant or an independent and certified computer programmer to independently verify exactly how many users log on per month and tweet something?

    Is there even such a thing as a CPA type computer programmer that has a fidicary duty to go into the servers at Twitter to verify that they actually have that many users?

    Or are we just taking the word of the Twotter CEO – the CEO just says they have that many users and we are all supposed to believe it?

    I would like to know exactly how they independently verify how many users twotter actually has on a month to month basis.

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