Twitter dodges Wall Street tech tumble despite missing analyst expectations
Twitter appears to have avoided the wrath of Wall Street despite reporting a weaker-than-expected quarterly ad revenue and user growth this afternoon.
The social media giant said it had made “meaningful progress” toward its goal of reaching 315 million users and $7.5bn (£5.5bn) in annual revenue by the end of 2023.
Although ad revenue for the fourth quarter grew 22 per cent year over year to $1.41bn (£1.04bn), it missed analysts’ estimates of $1.43bn (£1.05bn).
However, unlike Meta, it seemed to dodge the Apple privacy storm.
Susannah Streeter, senior markets and investments analyst at Hargreaves Lansdown, told City A.M: “Twitter has flown away from the worst of the headwinds caused by Apple’s privacy changes, escaping with just a modest impact for the first quarter of the year. The IOS changes didn’t dent sales, which climbed 22 per cent in line with forecasts.”
“That’s been greeted with a big sigh of relief from investors who had feared the worst after Meta’s spectacular fall last week”.
As well as this, Snap and Tik Tok didn’t hammer Twitter’s user base in the same way as Meta’s, and instead monetisable active users on Twitter are up 13 per cent, just shy of forecasts.
Streeter said this was “a display of resilience which has also been greeted with cheer” for the social media giant.
Notably, today was the first set of results since Parag Agrawal took over from co-founder Jack Dorsey in November.
On what he would bring to the leadership position, Agrawal said in the results conference call: “We have been looking at how we can go faster, and provide more value. But now we are looking at execution”.
He also emphasised that transparency would be a key focus moving forward.
This is something that Kelsey Chickering, Forrester’s principal analyst, told City A.M: “The platform is trying to monetize all pieces of the customer lifecycle, with particular growth in the “buy” phase. All of the major social platforms are making an effort to create new social commerce products, and Twitter is no exception.”
Twitter also announced a new $4bn (£2.9bn) share repurchase program, on top of the $2bn (£1.5bn) in buybacks it approved in 2020.
Chief finance officer Ned Segal said the new buybacks demonstrate the company’s “confidence in our execution and our strategy,” said Segal.