As of April, 25 Analysts See $0.01 EPS for Twitter, Inc. (TWTR)

April 26 14:26 2018

Growth in ad sales and monthly users spurred a second-straight profitable quarter for Twitter as the social-media company on Wednesday reported first-quarter sales that exceeded Wall Street’s expectations.

In the first quarter, Twitter reported a net profit of 61 million Dollars or 0.08 USD per share. Shares in Twitter were down $0.72 for the day closing at $29.75.

Twitter shares trade at 42 times expected earnings over the next 12 months, roughly double the 20.5 times ratio of Facebook, according to Thomson Reuters data. Revenue in the USA increased 2% year on year, while global revenue jumped 53%.

“We grew total revenue 21pc year over year and owned-and-operated advertising revenue 28pc year over year, driven by continued audience growth, differentiated ad product features, improved return on investment and better sales execution”. Analysts had expected Twitter to add a net 5 million monthly active users in Q1. The company’s revenue growth also accelerated, up 21 percent year-over-year, even as the company’s Daily Active Users (DAUs) surged 10 percent year-on-year as well. “While a high-end fashion brand might still plough its advertising budget towards Instagram’s buy buttons, there’s no end to the potential for fast-moving consumer goods brands on Twitter, and recent moves such as doubling the character limit demonstrate the platform’s savviness to the fact”. Twitter cut its headcount 6 per cent past year.

Twitter’s push into live video and more personalised content is finally starting to pay off, boosting revenue and profit more than projected in the first quarter by luring users and advertisers. Twitter removed more than 142,000 apps, responsible for more than 130 million tweets, according to the company’s letter to investors. Twitter is originally known for its short messages (140 characters), though, on Nov 7 previous year the company doubled the length of tweets to 280 characters, but also, the expansion is not available to some languages like Chinese, Korean and Japanese.

While Twitter has built a solid core base of celebrities, politicians and journalists, it has failed to match the broader appeal of Facebook and other social platforms, hurting its ability to bring in ad revenues. “So, we get to show people what’s happening in the moment, but also show them what mattered most if they didn’t catch the particular event live”.

The micro-social network, Twitter has been the voice of nearly any and everything under the sun.

Jack Dorsey, the CEO has targeted at making Twitter more useful, including streaming programming like recaps of series like “Game of Thrones” and National Football League highlights.

Excluding one-off effects, the company earned 0.16 United States dollars per share against the analysts’ forecasts of 0.12 USD per share.

Twitter Punches Up Q1 Revenue 21% on Strong International Sales, Results Top Wall Street Estimates

As of April, 25 Analysts See $0.01 EPS for Twitter, Inc. (TWTR)
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