Twitter records strong revenue growth, beats forecasts, net loss of $137M in second quarter
Twitter strong good customer growth, saying it now has 316 million monthly users; markets in US and Europe have a good trading day
The pressure may be off Twitter management for a few weeks after the company beat forecasts with its second quarter earnings report. Revenue came in at $502 million, up an impressive 61 percent versus the prior year, and though the company is still in the red, its losses were actually a tad below the same quarter last year.
The number everyone likes to look at is new user growth, and this also came in above estimates, with Twitter now with 316 million monthly users.
Twitter shares are up slightly in after hours trading on what has been a good day for the stock markets (after several really bad ones). The Dow and NASDAQ each were up nearly a percent, as were markets in Europe. Maybe the good day was a reaction to the Shanghai stock exchange which only lost 1 percent in value earlier today.
Update: the conference call is kind of a downer, with the company pretty sure its growth is stalling, and not sounding very excited about future prospects – at least its immediate future prospects. What an odd call! Not surprisingly, Twitter stock now trading lower in after hours trading. Quite a head scratcher.
Here is Twitter earning release:
SAN FRANCISCO, Calif. – July 28, 2015 — Twitter, Inc. today announced financial results for the quarter ended June 30, 2015.
- Q2 revenue of $502 million, up 61% year-over-year, and above the previously forecast range of $470 million to $485 million. Excluding the impact of year-over-year changes in foreign exchange rates, revenue would have increased 68%
- Q2 GAAP net loss of $137 million and non-GAAP net income of $49 million
- Q2 GAAP EPS of ($0.21) and non-GAAP diluted EPS of $0.07
- Q2 adjusted EBITDA of $120 million, up 122% year-over-year, and above the previously forecast range
of $97 million to $102 million, representing an adjusted EBITDA margin of 24%
“Our Q2 results show good progress in monetization, but we are not satisfied with our growth in audience,” said Jack Dorsey, interim CEO of Twitter. “In order to realize Twitter’s full potential, we must improve in three key areas: ensure more disciplined execution, simplify our service to deliver Twitter’s value faster, and better communicate that value.”
￼￼￼Second Quarter 2015 Financial Summary
(In thousands, except per share data)
Second Quarter 2015 Operational and Product Highlights
Monthly Active Users – Average Monthly Active Users (MAUs) were 316 million for the second quarter, up 15% year-over-year, and compared to 308 million in the previous quarter. The vast majority of MAUs added in the quarter on a sequential basis came from SMS Fast Followers. Excluding SMS Fast Followers, MAUs were 304 million for the second quarter, up 12% year-over-year, and compared to 302 million in the previous quarter. Mobile MAUs represented approximately 80% of total MAUs.
Consumer Products –Twitter launched a new autoplay feature for native videos, Vines and GIFs, as well as Periscope live video streaming on Android.
Advertising Products – Twitter launched objective-based campaigns, reports and pricing to all advertisers globally in order to drive higher ROI. Twitter also introduced installed application category targeting, a new feature that enables app advertisers to reach mobile users based on the categories of apps they have installed on their device. Twitter also rolled out Audience Insights, a tool that provides advertisers with aggregate information such as user demographics, interests, and purchasing behavior so they can better understand their key audiences.
Partnerships – Twitter announced a partnership with Google’s DoubleClick platform to improveadvertising performance measurement and attribution for Twitter direct response marketers. As part of the partnership, Twitter will also make its inventory available through the DoubleClick Bid Manager platform. Twitter also launched its Official Partner Program, a new initiative combining industry-leading product and service partners that help businesses achieve better results on Twitter and beyond.
Developers – Twitter’s mobile developer conference, Flock, continued its world tour with events in Asia Pacific and Latin America. In addition, Twitter announced a standalone Digits kit and introduced open sourcing for both Fabric and Digits kits on Android.
Acquired Companies – Twitter acquired TellApart, a leading marketing technology company providing retailers and e-commerce advertisers with unique cross-device retargeting capabilities through dynamic product ads and email marketing, and Whetlab, a startup focused on machine learning and artificial intelligence.
Second Quarter 2015 Financial Highlights
Revenue – Revenue for the second quarter of 2015 totaled $502 million, an increase of 61% compared to $312 million in the same period in 2014. Excluding the impact of year-over-year changes in foreign exchange rates, revenue would have increased 68%.
- Advertising revenue totaled $452 million, an increase of 63% year-over-year. Excluding the impact of year-over-year changes in foreign exchange rates, advertising revenue would have increased 71%.
- Mobile advertising revenue was 88% of total advertising revenue.
- Data licensing and other revenue totaled $50 million, an increase of 44% year-over-year.
- US revenue totaled $321 million, an increase of 53% year-over-year.International revenue totaled $181 million, an increase of 78% year-over-year.
Net loss – GAAP net loss was $137 million for the second quarter of 2015 compared to $145 million in the same period in 2014. GAAP net loss for the second quarter of 2015 included $175 million of stock-based compensation expense.