Twitter 2014 revenues double but user growth declines

What: Although it had a US $132 million net loss, Twitter revenues in 2014 first quarter were of US $250 million , almost doubling last year´s figure.
Why it matters:  Growth was mainly fueled by a substantial increase in dvertising revenue. The bad news is that the user growth rate declined. Twitter's stock tanked by 10% after the earnings announcement.

twitterTwitter released its first quarter financial results, revealing a US $132 million net loss, or 23 cents per share.The good news is that Q1 revenues increased to US $250 million, up 119% year-over-year, doubling 2013 revenues of US $ 114.3 million  and beating most of  Wall Street analysts´ expectations.  This growth was mainly fueled by an increase in advertising revenue, which totaled US $226 million during the first quarter, a 125% year-over-year increase. Mobile advertising revenue accounted for approximately 80% of total advertising revenue.Data licensing and other revenue totaled US $24 million, an increase of 76% year-over-year.Regarding International revenue,which represents at least 28% of total revenue, the number  totaled US $70 million, an increase of 183% year-over-year.

Sluggish user growth?

Despite the revenue growth, Twitter sluggish user growth  ended up attracting the most attention, as it is a lingering concern among Wall Street investors and tech observers. Twitter's stock fell nearly 10 percent after the figures went public.In its second earnings statement as a public company, Twitter reported 255 million monthly active users, up from 241 million from the last quarter but falling short of analysts' projections of 257 million. The San Francisco-based digital platform's user base grew by 25 percent in Q1 compared to the same period in 2013. That's down from a 30 percent year-over-year increase in Q4 '13 and a 39 percent YOY increase in Q3 over their respective prior-year quarters.

 

“Timeline views”

Timeline views measure how often users refresh their own Twitter account or someone else’s. These measurement reached US $ 157 billion for the first quarter of 2014, an increase of 15% year-over-year.Advertising revenue per thousand timeline views, reached US $1.44 in the first quarter, doubling last year´s figure.

Monthly active users grew to 255 million in the first quarter, including re-acceleration in twitter´s largest market, the U.S., which added 3 million net new users. Mobile active users  reached 198 million in the same period, an increase of 31% year-over-year, representing 78% of total MAUs.

The company has so far launched improved tools for advertisers, allowing them to create tailored audiences from email lists and CRM databases, target TV conversations for Spanish-language television, and connect with users through Promoted Accounts in search.

"Content creators, publishers and marketers care about 2 things: scale and engagement, and our platform increasingly delivers both of those," said Dick Costolo, CEO of Twitter.

"We had a very strong first quarter. Revenue growth accelerated on a year over year basis fueled by increased engagement and user growth.We also continue to rapidly increase our reach and scale. With the integration of MoPub, we now reach more than 1 billion iOS and Android users each month, making us one of the largest in-app mobile ad exchanges in the world and the only one at scale to offer native in-app advertising,"he added.

Twitter's outlook for the second quarter of 2014 ,projects a revenue ranging between US $270 million to US $280 million, with an adjusted EBITDA of US $25 million to US $30 million.

For the full year, the company expects US $1,2million to US $1,25 million, with Adjusted EBITDA of US $180 million to US $205 million. However, analysts’ forecast a US $1.24 billion revenue.


Editorial Staff (@portada_online)

Portada is the leading source of news and analysis on the Latin Marketing and Media space. Credibility is our biggest asset: The Portada team is very passionate about producing high-quality independent content that helps drive forward the Latin Marketing and Media space.
El equipo editorial de Portada se apasiona por elaborar contenidos de alta calidad. La credibilidad es nuestro mayor activo. La misión de Portada es ayudar a profesionales de negocios y medios a comprender y alcanzar a consumidores latinoamericanos, del mercado hispano de EE UU y España.

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