What To Expect From Twitter After Earnings Beat

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TWTR: Twitter logo
TWTR
Twitter

Twitter (NYSE:TWTR) announced its Q1 results on Wednesday, April 25. The company reported an improvement in revenue growth after a slowdown through 2017. Net revenues were up 21% to $665 million for the quarter, with the international segment contributing significantly to the growth in revenues. While U.S. ad revenue was up 2% y-o-y to $347 million, international ad revenues jumped 53% y-o-y to $318 million. The company attributed this growth to strength in Asia-Pacific, particularly growth in video in Japan and performance ad products in China. With these trends expected to continue, international ad revenue will likely exceed U.S. ad revenue in the coming quarters, per company estimates.

The total monthly active users (MAUs) were up 3% on y-o-y basis to 336 million for the quarter. As a result, the average implied revenue per user for the quarter was up to $2 for the quarter (or $8 on an annualized basis). As a result we have revised our full year forecast for average revenue per user and resulting net revenues for Twitter.

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For the full year, we forecast the company-wide MAUs to increase by 4% million to 342 million, with ARPU increasing by over 50 cents over the comparable prior year period to nearly $8. As a result, we forecast Twitter’s net revenue to increase by over 10% to $2.7 billion, while net income and EPS are expected to increase by over 15% on a y-o-y basis. We have summarized our expectations on our interactive dashboard platform. If you disagree with our forecasts, you can change the key drivers – such as active users and average revenue per user (ARPU) – for Twitter to gauge how changes will impact its expected revenue. You can also change margins to arrive at the expected EPS for the year.

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