For the second consecutive quarter, Twitter Inc (NYSE: TWTR) stock is trading higher after the company reported a first-quarter profit and exceeded Wall Street expectations for user growth.
On Wednesday morning, Twitter reported first-quarter earnings per share of 16 cents on revenue of $655 million. Both numbers beat consensus forecasts of 12 cents and $608 million, respectively. Revenue was up 21 percent from a year ago.
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Another profitable quarter demonstrated to the market that Twitter’s fourth-quarter profit was no fluke. The past two quarters have been Twitter’s only profitable ones in the company’s history. The company also said it expects 2018 to be its first profitable year.
Twitter reported 336 million monthly active users, above consensus estimates of 334.2 million and up 3 percent from a year ago. The strong user growth was boosted by international numbers. Twitter reported just 69 million U.S. monthly active users, short of consensus estimates of 70 million. However, 267 million international monthly active users came in ahead of Wall Street projections of 266 million. Twitter also said daily active users were up 10 percent year-over-year.
Twitter stock and other online advertisers experienced a turbulent first quarter of trading on concerns about how the Facebook (FB) Cambridge Analytica scandal could impact business. However, Twitter CEO Jack Dorsey says the company’s ad business is strong, even as Twitter makes moves to address privacy concerns and content quality.
“We grew our audience and engagement, marking another quarter of double digit year-over-year [daily active user] growth, and continued our work to make it easier to follow topics, interests, and events on Twitter,” Dorsey says in a statement. “We also introduced a new framework to think more cohesively about the issues affecting our service, including information quality and safety.”
Looking ahead, Twitter guided for second-quarter earnings before interest, taxes, depreciation and amortization of between $245 million and $265 million and adjusted EBITDA margins of between 37 and 39 percent. First-quarter EBITDA was $244 million.
GBH Insights head of technology research Daniel Ives says Twitter came through with another blowout quarter for investors.
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“Overall, 1Q was a breath of fresh air for investors that have patiently awaited for this turnaround story to manifest after years of pain, and it looks like the Twitter growth train is back on track delivering two very strong consecutive quarters,” Ives says.
GBH Insights has an “attractive” rating and $35 price target for TWTR stock.
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Another Twitter Inc (TWTR) Earnings Beat Reassures Investors originally appeared on usnews.com
