Twitter earnings beat estimates but user numbers of 288m miss as growth slows

Lynsey Barber
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Twitter posted a mixed bag in fourth quarter earnings (Source: Getty)
dir="ltr">The figures

Twitter now has 288m monthly active users (MAUs), up 20 per cent on the same fourth quarter period last year, below expectations of 295m and a slight decline in growth compared to last quarter when MAUs grew 22 per cent. Twitter had 284m users in the previous quarter.

Revenue was up ahead of expectations however, to $479m for the quarter and up 97 per cent year-on-year, and earnings per share came in at 12 cents beating the six cents expected.

For the full year, Twitter's revenue was $1.4bn.

Why it's interesting

Monthly active users are Twitter's major growth measurement and there have been fears that it is struggling to grow those numbers.

Rumours have swirled about Dick Costolo's exit as he faces increasing pressure to keep the wheels on social network juggernaut and he'll be hoping a strong quarter puts that talk to rest and keeps investors happy.

What Twitter said

Chief executive Dick Costolo said:

We closed out the year with our business advancing at a great pace. Revenue growth accelerated again for the full year, and we had record quarterly profits on an adjusted EBITDA basis. In addition, the trend thus far in Q1 leads us to believe that the absolute number of net users added in Q1 will be similar to what we saw during the first three quarters of 2014.

In short

The poor growth in monthly users won't ease anyone's worries about growth, but the fact that earnings came in ahead despite this sluggishness is positive news. It means Twitter is making more money from each user and that its host of new features on the advertising front is paying off.

This mixed picture showed in after-hours trading when shares initially dived as much as six per cent and then climbed 10 per cent higher at pixel time.

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