Despite Strong Q1 Quarter, Twitter Inc (NYSE:TWTR) Struggling To Keep Investors Happy

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Dallas, Texas 05/06/2014 (FINANCIALSTRENDS) – It seems as if Twitter Inc (NYSE:TWTR) is losing its charm among its audience. As the company recently said its 225 million monthly users appeared to surf Twitter service less frequently than a year ago. Even though the strong quarterly results, the latest data didn’t go too well among investors, who desperately wants the micro-blogging platform to become a communications utility that Facebook has become.

For the first quarter ended March 31, 2014, Twitter posted revenue of $250 million, up by 119 percent compared to $114 million in the same quarter a year ago. While the GAAP net loss for the first quarter of 2014 was $132 million compared to a net loss of $27 million last year and the non-GAAP net income was $183,000 for Q1, 2014 compared to a non-GAAP net loss of $11 million in the Q1 of 2013.

Loss per share for the quarter was $0.23 compared to $0.21 loss per share announced during the same quarter last year.

Twitter Chief Executive Dick Costolo said, “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 one 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.”

As of March 31, 2014, Twitter had approximately $2.2 billion in cash, cash equivalents and marketable securities.

User base update

The micro-blogging company saw a 25 percent year-over-year rise in its Average Monthly Active Users reaching upto 255 million; while mobile monthly active users reached 198 million, an increase of 31 percent year-over-year. Mobile MAUs now represents 78 percent of the total monthly active users of Twitter, according to the company. In addition, Timeline views increased 15 percent on yoy basis to reach at 157 billion for the first quarter. The company said the advertising revenue per thousand timeline views reached $1.44 in Q1, an increase of 96 percent yoy.

Q2 expectations

For the second quarter of 2014, Twitter projects the revenue to be between $270-$280 million; adjusted EBITDA to be in the range of $25-$30 million; and stock-based compensation expense to be between $170 million and $180 million. However, for full year of 2014, revenue projections are in the range of $1,200-$1,250 million; adjusted EBITDA between $180-$205 million; capital expenditures in the range of $330-$390 million; and stock-based compensation expense from $640-$690 million.

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