How Did Twitter Perform In Q1?

by Trefis Team
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Upside
36.77
Market
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Trefis
TWTR
Twitter
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Twitter (NYSE:TWTR) reported its Q1 earnings on April 23. The company beat consensus estimates across user base growth, revenue and EPS leading the stock to rally by over 15%. Twitter’s total revenue grew to $787 million (+18% y-o-y) and monetizable mobile daily active users (mDAUs) grew to 130 million (+11% y-o-y). The company’s sustained focus on platform health and ad engagement appear to be bearing fruit. Accordingly, we have updated our price estimate for the company to $37 per share, which is slightly below the market price following the rally.

Highlights From Twitter’s Q1 Earnings

  • Advertising revenue grew to $679 million (+18% y-o-y), with ad engagements growing 23% y-o-y while cost per engagement (CPE) declined by 4% y-o-y. Data licensing and other revenue grew to $107 million (+20% y-o-y).
  • U.S. revenue grew to $432 million (+25% y-o-y), average U.S. mDAUs were 28 million (vs 26 million a year ago and 27 million in the previous quarter) and APRU grew to $15.4 (+16% y-o-y).
  • International revenue grew to $355 million (+11% y-o-y), with average international mDAUs of 105 million (vs 94 million a year ago and 99 million in the previous quarter) and APRU was flat at about $3.40.
  • For Q2, the company’s management expects revenue to be in the range of $770-$830 million, and operating income to be in the range of $35-$70 million
  • Twitter’s management sounded confident that it will be able to grow sustainably while also improving margins on the back of better user engagement (to drive user base growth), higher ROI for advertisers (to help achieve better pricing).

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