TWITTER Inc posted quarterly revenue that missed Wall Street targets and cut its full-year revenue forecast due to weak demand for its new direct response advertising, sending its shares down as much as 24 percent on Tuesday (April 28).
Twitter projected 2015 revenue of $2.17 billion to $2.27 billion, compared with its earlier forecast of $2.3 billion to $2.35 billion. Analysts on average had been expecting full-year revenue of $2.37 billion.
Twitter said its new direct response ads that companies can tweet to targeted users, with say, a clickable business card or a link to drive traffic to the advertiser’s website, did not produce the revenue expected.
The company, which allows users to broadcast 140-character messages, said revenue rose to $436 million in the first quarter from $250.5 million a year earlier. This was below the average analyst estimate of $456.8 million, according to Thomson Reuters.
The company’s monthly active users rose 18 percent from the previous year to 302 million, in line with some analysts’ expectations of slowing growth.
Twitter’s net loss widened to $162.4 million, or 25 cents per share, for the quarter ended March 31, from $132.4 million, or 23 cents per share.
Excluding items, the company earned 7 cents per share.
Analysts on average had expected Twitter to earn 4 cents per share, according to Thomson Reuters.
Twitter shares closed down 18.2 percent at $42.27 on the New York Stock Exchange. They pared losses to trade at $43.16 after hours
(Reuters)
