Twitter Underwhelms With User Numbers

Twitter Inc. (NYSE: TWTR) reported its fourth quarter financial results after the markets closed Wednesday. This social media giant had $0.16 in earnings per share (EPS) on $710 million in revenue compared to consensus estimates from Thomson Reuters that call for $0.12 in EPS on $709.94 million in revenue. The same period from the previous year had $0.12 in EPS on $479.08 million in revenue.

Total average monthly active users (MAUs) were 320 million in the fourth quarter, up 9% year-over-year, compared to 320 million last year. Also MAUs were 305 million for the fourth quarter, up 6% from last year, but down from 307 million sequentially. Mobile MAUs represented roughly 80% of total MAUs.

Total audience, which consists of MAUs and monthly logged-out visitors, was more than 800 million in the fourth quarter.

In terms of first quarter guidance, Twitter expects to have revenues in the range of $595 million to $610 million, adjusted EBITDA in the range of $150 million to $160 million. There are consensus estimates that call for $0.08 in EPS on $629.25 million in revenue.

Twitter detailed in its report:

2015 was another very strong year for Twitter. Total revenue reached $2.2 billion, up 58% year over year with more than $550 million in adjusted EBITDA. We made significant progress in scaling the total number of active advertisers to 130,000 in Q4, up almost 90% year over year. It’s remarkable we built this business in just five years from zero revenue. We saw a decline in monthly active usage in Q4, but we’ve already seen January monthly actives bounce back to Q3 levels. We’re confident that, with disciplined execution, this growth trend will continue over time.

On the books, cash, equivalents, and marketable securities totaled $3.5 billion compared to $3.6 billion at the end of the same period from last year. Also 2015 marked the first full year of positive free cash flow for this company and Twitter even expects to generate significantly more free cash flow in 2016.

ALSO READ: Tesla Investors Looking Beyond Weak Earnings

Shares of Twitter closed Wednesday up 4% at $14.98, with a consensus analyst price target of $29.73 and a 52-week trading range of $14.31 to $53.49. Following the release of the earnings report, the stock was initially down 7.3% at $13.89 in the after-hours trading session.