Twitter Shares Dive After-Hours as User Growth Freezes


The shares of Twitter (NYSE:TWTR) closed $14.98 per share, up 4% driven by its improved timeline announced early today. However, the company wiped out some of the gains after releasing its quarterly financial results after-hours.

Twitter shares declined more than 3%% to $14.50 per share during the extended trading around 4:51 in the afternoon in New York. The company appeared to be negatively impacted by failure to boost its user growth.

Twitter average MAUs remained at 320 million

According to the company its total average monthly active users (MAUs) were 320 million in the fourth quarter ended December 31, 2015.  Twitter’s average MAUs during the previous quarter was the same.

TwitterTwitter said its MAUs were 305 million excluding SMS Fast Followers during the quarter, down from 307 million in the third quarter.  According to the company, mobile MAUs accounted approximately 870% of its total MAUs. Its total audience (MAUs and monthly logged-out visitors) were more than 800 million.

In a letter to shareholders, Twitter acknowledged the decline in MAUs during the quarter. However, the company noted that its MAUs in January rebounded to its levels in the previopus quarter.

“We’re confident that, with discipline execution, this growth trend will continue over time,” according to the company.

Twitter earnings beat estimate

During the quarter, Twitter generated adjusted earnings of $0.16 per share, higher than the $0.12 per share expected by Wall Street analyst.

Its revenue increased 48% to $710 million from $479 million in the same period a year earlier. Analysts expected the company to report $709.94 million in revenue.

According to Twitter, its revenue in the United States climbed 47% to $463 million and its revenue from data licensing and other was $70 million, up 48% year-over-year. Its adjusted EBITDA was $191.41 million, up from $141.49 million in the year-ago quarter.

The company said said the number active advertisers using Twitter ads increased 90% to 130,000 year-over-year. The growth was driven by its small and medium-sized business (SMB) initiatives.

“We spent the last six months structuring the organization and our leadership team to move with greater agility and focus, reviewing the state of our service and strategy, learning from what we’ve shipped, and developing a stronger point of view about what we are and what we want to be,” according to the company.

Related posts

Leave a Comment

This site uses Akismet to reduce spam. Learn how your comment data is processed.