Twitter doubles revenue but profit remains elusive

The site increased its user base by 30 per cent from last year but investors still pushed its stock lower

Twitter's annual earnings to date
Twitter's annual earnings to date
  • Twitter's annual earnings to date
  • Twitter's sign at its headquarters on Market Street in San Francisco
View all images

Twitter has reported its first earnings as a public company, revealing that sales more than doubled from a year ago, though it still hasn't managed to turn a profit.

Revenue for the quarter ended December 31 was $US243 million, up 116 per cent from the same quarter a year earlier, Twitter said in its earnings release. That was far higher than the $US218 million analysts had been expecting, according to a poll by Thomson Reuters.

Its loss was a hefty $US511 million, much greater than its loss of $US8.71 million in the fourth quarter of 2012. Excluding share-based compensation and other adjustments, it would have made a profit of $0.02 per share, again better than analysts had expected.

"Twitter finished a great year with our strongest financial quarter to date," CEO Dick Costolo said in a statement.

Still, investors reacted by pushing its shares down nearly 10 per cent in trading after hours, to $US59.60 at the time of this report.

The company ended the year with 241 million monthly active users, up 30 per cent from the fourth quarter of 2012. Despite the increase, it lags far behind Facebook, which has passed 1.2 billion monthly active users.

Twitter's advertising revenue totaled $US220 million for the quarter, up 121 per cent from a year earlier. More than 75 per cent of its ad sales were from ads placed on mobile devices, showing Twitter's ability to monetize its site on a critical platform.

It was Twitter's first earnings report since the company went public late last year at $US45 a share. Its IPO documents showed at the time that the company was growing fast but losing money.

Since the IPO, which was viewed as a success, the company has faced questions about its ability to maintain its growth rate and become a more "mainstream" service like Facebook.

One of Twitter's largest advertising products is its promoted tweets, which allow marketers to place sponsored tweets in users' streams. Twitter only charges marketers when people click on the tweet or follow the promoted account, however.

For the full year, Twitter's sales grew by 110 per cent, to $US665 million. Its net loss for the year was $US645 million.

Zach Miners covers social networking, search and general technology news for IDG News Service. Follow Zach on Twitter at @zachminers. Zach's e-mail address is zach_miners@idg.com

Join the newsletter!

Or

Sign up to gain exclusive access to email subscriptions, event invitations, competitions, giveaways, and much more.

Membership is free, and your security and privacy remain protected. View our privacy policy before signing up.

Error: Please check your email address.
Show Comments

Blog Posts

Does your brand need a personality review?

There are five tell-tale signs your brand needs to take a long hard look at itself.

Charlie Rose

Senior Strategy Consultant, Principals

How to create profitable pricing

How do we price goods and services? As business leaders, we have asked ourselves this question since the history of trading.

Lee Naylor

Managing partner, The Leading Edge

Sport and sponsorship: The value of event sponsorship

Australia’s cricketers captured the nation’s attention during their recent run to the semi-final of the ICC Men’s World Cup. While the tournament ultimately ended in defeat, for over a month it provoked a sense of belonging, hope and empowerment for millions of people across Australia. Cricket, and sport in general, has a near-unique ability to empower individuals, irrelevant of their background, demographic or nationality.

Nikhil Arora

Vice-president and managing director, GoDaddy India

I had the same vision about change from CX terminology to HX. Even with almost the same title: 'Forget customer experience...' https://ww...

Ekaterina Khramkova

Forget customer experience, human experience is marketing's next frontier

Read more

Thank you, so do I.

David Freeman

Sustainability of message: H2coco founder's commitment to consumers

Read more

Hi Harry, thank you for pointing this out I can confidently say both these bottles are in transition away from PET as we continue to impr...

David Freeman

Sustainability of message: H2coco founder's commitment to consumers

Read more

I’m confused. He has a giant 2l hard plastic bottle in Coles and his pink bottle is also in plastic??

Harry

Sustainability of message: H2coco founder's commitment to consumers

Read more

Great message from an Aussie company about sustainable business practices, particularly packaging. Wish more businesses would think more ...

Krisy

Sustainability of message: H2coco founder's commitment to consumers

Read more

Latest Podcast

More podcasts

Sign in