Twitter is profitable again in 1st quarter
Twitter has remained largely outside of the crosshairs of Congress over the privacy issues that have tripped up Facebook, but it continues to face its own, unique challenges.
The company is wrestling with abuse on its own platform as well as a potential accounting for disinformation campaigns that led up to and followed the 2016 presidential election, though Twitter suspended the accounts of many well-known white nationalists in December.
During a call with analysts Wednesday to discuss first-quarter earnings, CEO Jack Dorsey sought to differentiate Twitter from its social media peers. Twitter, he said, is public, “so all of our data is out in the public, out in the open.”
Unlike Google and Facebook, however, Twitter has struggled with profitability.
The company on Wednesday posted only its second profitable quarter and despite some strong growth overseas, many on Wall Street remain jittery about its prospects.
Despite a surprisingly robust quarter, shares tumbled 2.4 percent to $29.75 on Wednesday after the company warned of tougher performance comparisons ahead.
Some of the challenges in surpassing what turned out to be a very impressive finish last year have already begun to emerge, at least to some investors.
Daily active users increased 10 percent, down from 12 percent growth in the fourth quarter, and 14 percent growth a year ago.
Wedbush Securities analyst Michael Pachter said the diminished growth spooked investors. Still, Pachter believes that daily user numbers are better than the tepid 2 percent monthly active user growth and as those two begin to converge, a more promising picture will emerge for Twitter.
For the three months ended March 31, Twitter Inc. earned $61 million, or 8 cents per share. A year earlier the San Francisco company lost $61.6 million, or 9 cents per share.
Removing certain items, earnings were 16 cents per share. That’s 4 cents better than what analysts polled by Zacks Investment Research expected.
Revenue increased sharply to $664.9 million from $548.3 million, bolstered by a 53 percent jump in international revenue. The performance easily beat the $609.9 million in revenue that analysts projected.
It had 336 million monthly average users in the quarter, up from the 330 million in the previous quarter and the 319 million users a year earlier.