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Twitter -11.2% AH. Guidance strong, but Timeline views drop Q/Q

  • Twitter (TWTR) is guiding for Q1 revenue of $230M-$240M (above a $215.2M consensus) and adjusted EBITDA of $10M-$16M. Full-year guidance is for revenue of $1.15B-$1.2B (above a $1.13B consensus) and adjusted EBITDA of $150M-$180M. Full-year capex is expected to total $330M-$390M.
  • One troubling datapoint: Twitter's Timeline views fell 7% Q/Q in Q4 to 148B. On a Y/Y basis, views were up 26%, but that's a much slower pace than Q3's 50%.
  • Twitter's revenue growth accelerated to 116% Y/Y in Q4 from 105% in Q3, as the launch of several major new products provided a big lift to monetization. Ad revenue +121% to $220M, data licensing/other +80% to $23M.
  • Twitter's ad revenue per 1K timeline views for seasonally strong Q4 was $1.49, up 54% Q/Q and 76% Y/Y. International revenue tripled Y/Y, but still only accounts for 27% of total revenue; Twitter's international user base is more than 3x as large as its U.S. base.
  • Monthly active users (MAUs) totaled 241M at the end of Q4, +4% Q/Q and +30% Y/Y. Mobile MAUs +37% Y/Y to 184M.
  • Mobile accounted for over 75% of ad sales, up from 70% in Q3 and 65% in Q2.
  • CC at 5PM ET. Q4 results, PR
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Comments (50)
  • Andrei Volgin
    , contributor
    Comments (590) | Send Message
     
    Who cares about revenue guidance if users start to leave? There is a sharp slow-down in MAUs and a drop (!) in timeline views. I guess the U.S. audience is already falling. The international will follow soon.
    5 Feb, 04:26 PM Reply Like
  • alext1379
    , contributor
    Comments (706) | Send Message
     
    These social media stocks might as well be throwing darts at a wall.
    Timeline Views down but everything else beats estimates so the stock tanks 11%.

     

    This will be forgotten next quarter just like Facebook's "losing teen users" killed a good quarter and then was promptly discarded the next quarter.

     

    These results should have the stock up 11% even if its only for a week.
    5 Feb, 04:27 PM Reply Like
  • Andrei Volgin
    , contributor
    Comments (590) | Send Message
     
    I am sorry for your loss, but I believe TWTR should fall 90% before its valuation starts to resemble something close to normal. At the current levels losing users is a death penalty.
    5 Feb, 04:35 PM Reply Like
  • Joseph Poma
    , contributor
    Comments (437) | Send Message
     
    I have to disagree. The "losing teen users"report was refuted by their numbers. No one was expecting user growth to come in with the numbers that it did. Revenues and profit are meaningless right now for them because without user growth the company has nothing to compete with against Facebook and Google.
    5 Feb, 04:36 PM Reply Like
  • alext1379
    , contributor
    Comments (706) | Send Message
     
    What loss? I strangled TWTR so I don't care which way it goes as long as it keeps going once it picks a direction.
    5 Feb, 04:59 PM Reply Like
  • 6269751
    , contributor
    Comments (643) | Send Message
     
    The "losing teen users" was discarded because it was a mistaken indicator. Losing the young,cool (oh and by the way penniless) was not that important. Besides individuals FB serves as a storefront for professionals, small and large businesses. Even the cat my wife follows on YouTube has a Facebook page because they want to have brand recognition. So if you think timeline views are unimportant in the general success of TWTR and you are right then that factor will be discarded.
    5 Feb, 10:50 PM Reply Like
  • mikemath
    , contributor
    Comments (26) | Send Message
     
    almost sounded if u were paying condolences
    6 Feb, 08:07 AM Reply Like
  • benitus
    , contributor
    Comments (1961) | Send Message
     
    alex....the trend is what worries the traders, not the investors. So, even if the guidance is good, the trend of usage is going down because FB is a direct competition for advertisers and they provide a proven and better platform for ad views. The next release of lock-ups is many times much worse than this time, so brace yourself for a hard landing and get out now while you can.
    5 Feb, 04:34 PM Reply Like
  • alext1379
    , contributor
    Comments (706) | Send Message
     
    I wouldn't own twitter until it was under $30 and had a p/e of less than 100.
    5 Feb, 05:00 PM Reply Like
  • ronjohn26
    , contributor
    Comments (86) | Send Message
     
    $30 is my highest buy rate , I guess it will come down to $25 or $ 20 !! or even $ 17 like FB !!!!!
    7 Feb, 03:08 PM Reply Like
  • ericmcarter
    , contributor
    Comments (188) | Send Message
     
    Gotta love "Q4 net loss of $511 million and non-GAAP net income of $10 million"... I would love to read how this is reconciled.
    5 Feb, 04:37 PM Reply Like
  • benitus
    , contributor
    Comments (1961) | Send Message
     
    eric....where does it say "Q4 net loss of $511 million", which is huge.
    5 Feb, 05:25 PM Reply Like
  • ValueinvestorEU
    , contributor
    Comments (562) | Send Message
     
    They have a huge compensation expense (stock awards). the 511 is correct.
    5 Feb, 05:28 PM Reply Like
  • benitus
    , contributor
    Comments (1961) | Send Message
     
    Thanks, valueinvestor......many people are talking about the obscene executive compensation now, so I'm just as incensed as you are. The SEC should step in and rake Twitter all over to uncover the dirt, since management is still refusing to divulge pertinent information, like the patents deal. Meanwhile, it seems like the dreamers can't break past $54 this morning, so I'm bracing myself for covering more shorts at $47 (every $5 down, until it reaches $32). If I don't cover some as it goes down, I can't short again when it rebounds, as they often do, and I can't increase my winnings when it turns back down. I can do this all day, which is why I often make several round-trips with popular stocks that have less than spectacular results. It's unfortunate that my broker platform didn't let me short any more (until 7pm tomorrow) after the rebound when market opened. Must find myself another broker who does.
    6 Feb, 10:36 AM Reply Like
  • jamesfreiley
    , contributor
    Comments (103) | Send Message
     
    The stock based compensation for 2014 of 500 to 600 mil is also a negative...the lower the stock price the higher the dilution...it has a negative spiral effect on the stock...I think smart investors are recognizing this effect and the stock is tanking...
    5 Feb, 04:40 PM Reply Like
  • John Grandits
    , contributor
    Comments (376) | Send Message
     
    wouldn't stock based comp be based on # of options, vested shares, etc. not fixed $ amount?

     

    stock based compensation is based on a fixed # of shares and will fluctuate based on their value...perhaps it works differently at twitter.
    5 Feb, 04:49 PM Reply Like
  • YONSU
    , contributor
    Comments (190) | Send Message
     
    time line in my view should be a bit lower with the holidays in the quarter, Super Bowl in the next quarter should help
    5 Feb, 04:46 PM Reply Like
  • Andrei Volgin
    , contributor
    Comments (590) | Send Message
     
    Timeline views are lower than in Q3, when many people are on vacation, schools and colleges are closed, etc. This is as bad as it gets.
    5 Feb, 06:13 PM Reply Like
  • Joseph Poma
    , contributor
    Comments (437) | Send Message
     
    Sorry guys, don't try and justify it. Didn't they say something like 75% of views were mobile? What do college kids leave their phones at school when they go home for break? Do they just stop tweeting when they go on vacation. NOPE! I'll talk to my students tomorrow and get some different insight, but the way I see it, there is no justifying decreasing timeline views.
    5 Feb, 06:18 PM Reply Like
  • Andrei Volgin
    , contributor
    Comments (590) | Send Message
     
    @Joseph

     

    My sons (one in college, one in school) say that not one of their friends is on Twitter. They use Instagram and Snapchat, but no Twitter, and most stopped updating Facebook accounts.
    5 Feb, 06:25 PM Reply Like
  • Joseph Poma
    , contributor
    Comments (437) | Send Message
     
    Interesting, as a high school teacher I'm fortunate to have at least perhaps a little insight on student activity in social media. I've had many former students seek me out on Facebook (not so much on twitter where I only have an account to get current news). I'll be opening up discussion with my economics class tomorrow and with other students I have through out the day to get a better idea as to how the younger generation views social media. I'll be sure to post my findings.
    5 Feb, 06:29 PM Reply Like
  • Chris Lau
    , contributor
    Comments (1925) | Send Message
     
    I'm on a number of SM sites. #'s are click thru per single link post / followers:
    (TWTR): (10/750)
    (FB): 0/700
    (GOOG): 1/40,000
    StockTwits (not even publicly listed): 100/173
    5 Feb, 05:06 PM Reply Like
  • ValueinvestorEU
    , contributor
    Comments (562) | Send Message
     
    at 58 its still valued at 40.6 bllion. they disclosed 612 outstanding shares now. but it doesnt have the last 88 million options that are given this year.
    So ths company is officially 20% more expensive than people thought after it has dropped 13%.

     

    They could have read this n the s-1.
    5 Feb, 05:08 PM Reply Like
  • Joseph Poma
    , contributor
    Comments (437) | Send Message
     
    Data licensing revenue growth expected to be flat... that's a little disappointing. Wasn't that one of the big ideas for long term investors, that Twitter was supposed to be more than just another advertiser, but instead have a diversified revenue plan...
    5 Feb, 05:35 PM Reply Like
  • ValueinvestorEU
    , contributor
    Comments (562) | Send Message
     
    Twitter should be sued. takes easy questions from the most bullish analysts.

     

    Dodges the two most important question that are time bombs under the stock:

     

    What were the terms of the patent purchase?

     

    How expensive is that new manhatten office?

     

    from my crude caluations 140.000 square feet on mahatten costs between 100 and 170 million dollars a year. this is a huge bomb they are hiding away under their cost base.

     

    Benchmarking to microsofts patent purchases, Facebooks earlier patent purchases and the average price of a patentn. The cost is most likely between 500 million and 1 billion.

     

    Withholding such information is only withheld to save the insiders a better price on their shares
    5 Feb, 05:43 PM Reply Like
  • tawse57
    , contributor
    Comments (757) | Send Message
     
    Manhattan office? Why? I can only assume it is to target the NY ad agencies and Wall Stdeet banks. Sounds like desperation IMPO.
    5 Feb, 06:51 PM Reply Like
  • ValueinvestorEU
    , contributor
    Comments (562) | Send Message
     
    Thats a good question.
    They did mention they had good revenue growth from financials. one guess is could be that some financial company bought ads for 20m$ dollars to try and push up the price. it would definately be worth it for them, and it was done regularly at the dot.com bubble.
    I dont know why they want office there, but I know that it will cost them alot alot more than their current offices and that those costs have not even been mentioned, even though they are material.
    The patent price will also be a shocker. People thinking about investing should be careful, the management is not on your side, they are deliberately trying to sweep things under the rug only for you to find out later.
    They want to sell their overpriced shares to unsuspecting retail investors
    5 Feb, 07:33 PM Reply Like
  • ronjohn26
    , contributor
    Comments (86) | Send Message
     
    I am not sure whether twitter really hide any of their information as you mentioned in the post , it should be included some where but I am not sure . But One thing I am dam sure is , The current twitter price should not be over $ 30 at any chance . it is heavily over priced
    7 Feb, 03:17 PM Reply Like
  • Tradevestor
    , contributor
    Comments (4076) | Send Message
     
    And then there is this for Twitter http://seekingalpha.co...
    5 Feb, 07:01 PM Reply Like
  • dieuwer
    , contributor
    Comments (2409) | Send Message
     
    Does Facebook not have a "Timeline" feature as well? Does this mean Twitter is infringing on the copyright of Facebook??
    5 Feb, 07:13 PM Reply Like
  • taotaho
    , contributor
    Comments (6) | Send Message
     
    facebook went public and traded above 40 on the 1st day than dropped to 17 before coming on strong in the last few months , the same thing or worse will happen to TWTR ,I beleive you will be able to buy the stock in the low 10 s
    5 Feb, 08:08 PM Reply Like
  • benitus
    , contributor
    Comments (1961) | Send Message
     
    FB was different. It's IPO was a debacle. It took quite a while for them to monetize their user base but it was the mobile users that did the trick for them, which launched FB into orbit. TWTR, however, doesn't have anything going for them, for a variety of reasons, among which was its much smaller user base (shrinking all the time, which makes them desperate to generate more users) and its an entirely different platform and format. It was launched at $46 (I think) whilst FB was launched at $26 (I think), so if it cannot generate enough revenue to justify its over-priced market valuation, then it should by all accounts fall below $46 in no time, unless it can come up with innovations that will grow its revenue by leaps and bounds. Otherwise, $40 is very likely by the time the second lock-up is released. If the over-whelming support that it's currently enjoying has vanished by then, TWTR will fall through the floor but I do think it'll settle above $30 and not as low as $10. I would definitely buy in at $30.
    5 Feb, 08:22 PM Reply Like
  • ronjohn26
    , contributor
    Comments (86) | Send Message
     
    $30 is not my Buy point but I will be bit catious when It go below $30.
    $24.50 is my first Buy point for twitter ,But my own probability test says . twitter is going to face a disaster in may . It might go below $20 . I am still holding a huge set of short that I brought it for $74.20 and waiting untill it goes down to below £30's ,MAY is important for TWTR it may end up below $20 !!! Chances are high !!!!
    2 Apr, 08:57 AM Reply Like
  • benitus
    , contributor
    Comments (1961) | Send Message
     
    great job, ronjohn....for shorting TWTR at $74.20 but I do hope you had covered some when it went below $50, so that you can resume shorting it whenever it makes a vain attempt to recover above $50. I did say in my comments for another article that, if TWTR fails to go back above $50 for three consecutive days, then the wild support for the stock has evaporated and it will stagnate around $45 until something else happens that will push it back up above $50 or down below $40, in which case, it won't stop until it reaches $30.

     

    Considering the increasing drop in daily volume, I think I've become more pessimistic about TWTR. If it doesn't recover above $50 by the time the May lockups are released, then it will very likely fall below $30, especially if there's a mad rush out the door. Otherwise, there won't be any shoving to get out of TWTR by the insiders, who may likely wait for $60 at least to get out in stages, particularly if the support above $50 is substantial. So, your plan to buy in at $24.50 might very well work for you.

     

    As for me, I will commence covering my substantial short positions once it goes below $40 and I will turn around if it continues to go down to $30 or less, i.e. I'll go long below $30, unless it hits $30 way before the lockup release, in which case, I will hold back on going long, until the murky waters are clear enough for me to wade into it. Let's hope to meet each other below $20. Live long and prosper, my friend.
    2 Apr, 12:05 PM Reply Like
  • ronjohn26
    , contributor
    Comments (86) | Send Message
     
    I had a detailed study about twitter and the result I have received was very shocking . So my strong intuitions is It will touch $20. I have taken consideration of twitter user base and famous people who were using Twitter. Example :(Not revealing the personal details) I have noticed that followers of those people are reduced on a monthly basis and noted that The same people's FB followers are almost doubled . that means FB 's user base is very very strong and growing on monthly basis(which is why I said FB touch $80 ) . So, that's my updates at this point . I did not cover my twitter when it went below at $50 but I covered half when it went $40.60. I am actually a new player on stock market I have only 2 years experience here and I am learning to play some interesting Game here and I enjoying it . Let my Jesus give me some strength and knowledge to play around :) God Bless you
    3 Apr, 09:39 AM Reply Like
  • 6269751
    , contributor
    Comments (643) | Send Message
     
    So my April TWTR Put 45 option looks like it will be well into the money. Before that I am 1 and 1, won one and lost one. Be careful with TWTR, it is a feisty stock. It will bounce up after getting knocked down. I don't recommend establishing a short position for this reason. If you never looked at your account it would be fine when it finally wilts down to the 20's. But meanwhile your broker might be contacting to cover your short position, which would force you to look. So option bets are a lower stress method.
    3 Apr, 01:26 PM Reply Like
  • ronjohn26
    , contributor
    Comments (86) | Send Message
     
    6269751 ,You short at 45 ?my intution is twtr can go up and down between 40 to 49.90 untill may . My positions are shorted above 70 and I had covered the risk when it went around 40 . Twtr is a bubbled stock as I said when it went above 70 and you know it can bubble even without a valid reason and you know who might be playing in between to bubble the stock :) The sad point is , It might take years twitter to touch above 70 unless otherwise some magic forumula introduced :)My buy Point is between 20 to 30 !!!!
    4 Apr, 05:15 AM Reply Like
  • benitus
    , contributor
    Comments (1961) | Send Message
     
    ronjohn.......I don't know how you did your analysis but numbers alone can't get you into the ball-game all the time (maybe, some of the time), so you need to find a few reliable sources of information where you can get a physical feel of the situation because the stock market operates largely on emotions 80% of the time, not because all the players in the market are emotional, but because the corporate and hedge-fund traders rely on rumors to whip up emotions that will enable them to make a killing off those who are nervous or ignorant about what's going on.

     

    So, people like me ride on these trends and make money off those who are stubborn and refuse to read the signs until they loose their nerves. For me, I thrive on two extremes if I'm caught with my pants down, either I dump everything and reverse my positions immediately (if it's something real), or I simply ride out the storm and wait for sanity to return (if it's a false alarm). I'm very well-connected to the grapevine, so I can stay one step ahead of market trends if I'm into the game, but lots of times, I'm off the grid when I make my quota for the day.

     

    I wonder when did you cover at $40.60 because the last time it touched $40 was in last November before it was pushed up to the roof (past $74.00) suddenly after Christmas, which was a classic case of what I said earlier. Those who were smart enough and shorted everything they had would have been able to make a killing when it went back down to $50 on 02/06/14. I started shorting it when it went past $65 (I think) before Christmas and continued shorting it after Christmas because I was certain that it will drop below $50 eventually, unless the management is transparent and come up with something that will drive their revenues significantly, which they haven't done so at all thus far.

     

    Yesterday's drop was expected and there'll be more drops to come, so the smart money should stay away from TWTR for the time being, unless you want to short some more if and when it clears $50, assuming you've covered some yesterday, which I did. But I'm still waiting for a big payday when it gets down to $30 and I'll turn around with the 25% short positions that I'm keeping until then. Live long and prosper, my friend.
    4 Apr, 10:35 AM Reply Like
  • Island_Dweller
    , contributor
    Comments (394) | Send Message
     
    Focus here is the future. Can you imagine a world without Twitter? Celebrities use it as a means to communicate to their fans, companies use it to post breaking information and in turn followers can react and make decisions, and then there's the international community.

     

    While the younger generation may continue to overlook the usefulness of TWTR (I'm not convinced of this), it's clear the business world is addicted. This is the first quarter with information to digest, and I believe the company is in no real danger of any kind. With the kind of run it had, the only way it would've moved higher is with an absolute perfect earnings report.
    5 Feb, 10:23 PM Reply Like
  • Andrei Volgin
    , contributor
    Comments (590) | Send Message
     
    I can see TWTR going forward as a successful, well-respected company, generating $1.2-2 billion in annual revenues, and valued at $5 billion. But $40 billion with barely any user growth? No way.
    5 Feb, 11:25 PM Reply Like
  • ronjohn26
    , contributor
    Comments (86) | Send Message
     
    I agree your point ''Celebrities use it as a means to communicate to their fans, companies use it to post breaking information and in turn followers can react and make decisions, and then there's the international community'' But if you take 20 'Celebrities and analyse their Number of fans ! You can see the numbers are decreasing or staying same and the Same period These people's FB's Following Page is almost double or it is highly increasing . It's because users behaviour are changing ,other than tweeting there is nothing interesting in twitter , where as in FB so many features included and now even Whatsap comes to picture .Twitter's ad revenue is going decline because it was based on the populairty and user base , when these two decrease automatically ad companies stay away .
    These are just few reason why I feel It touch the pathetic $20 's
    3 Apr, 12:27 PM Reply Like
  • 6269751
    , contributor
    Comments (643) | Send Message
     
    Ron, I agree, twenties. But it's not pathetic. That is what the professionals priced it for IPO, $27. That was about right. It should have stayed maybe in the thirties, until it proved itself. People drank the koolaid and here we are today.
    3 Apr, 01:31 PM Reply Like
  • ronjohn26
    , contributor
    Comments (86) | Send Message
     
    my study reveals something else ! its a bubbled stock it should trade between 20 to 30 . May is important for twitter .
    4 Apr, 05:18 AM Reply Like
  • 6269751
    , contributor
    Comments (643) | Send Message
     
    Warren Buffet said that investing is simple. It actually is but can be quite boring if done correctly. The tech sector is the place to go for fun (and a few solid longs). However tech growth stocks are basically bubbles all. TWTR is already old news and the only viable strategies are profiting from its settlement to reasonable values. The new tech bubbles are robots and 3d printing, that's where the action is going forward.
    4 Apr, 10:03 AM Reply Like
  • 6269751
    , contributor
    Comments (643) | Send Message
     
    Before this earnings report the stock was up 150% from IPO. I don't understand why it is that valuable or why it is here to stay so I could not be long TWTR. "It's going up because it's going up" is not a reason. Sometimes the market herd stampedes to nice prairie and sometimes over a cliff. Why not play a relatively safer stock in the momentum category?
    5 Feb, 11:00 PM Reply Like
  • Kenjisan
    , contributor
    Comments (49) | Send Message
     
    Which may that be? $TSLA?
    5 Feb, 11:29 PM Reply Like
  • ronjohn26
    , contributor
    Comments (86) | Send Message
     
    Share market always react based on the news not with the actuals . I knew that the twitter is over priced and when it went to $74 I really laughed , Because I knew the share is not even worth $ 25
    7 Feb, 03:24 PM Reply Like
  • 6269751
    , contributor
    Comments (643) | Send Message
     
    Wow if you had bet that you'd be up $20 per share! TSLA is good because of Elon Musk. FB is good because of Zuckerberg. The guy who started TWTR is still on the board of course but his day job is CEO of another company. I am not a market finance expert but I am something of tech expert going back quite a ways. I look at TWTR from a techie point of view and I just can't believe in it. The market has been constantly linking it with FB and now Zuckerberg is going all Bill Gates and getting evil with his market clout by buying another 350 million users.
    20 Feb, 01:45 AM Reply Like
  • june1234
    , contributor
    Comments (2647) | Send Message
     
    Good call. Like AMZN twitter's been a stock appreciation play for its employees and investors from day 1. Like AMZN both are hugely popular with the public, not hard to promote either. Something/anything only being worth what someone else is willing to pay for it at the time.
    6 Feb, 04:51 AM Reply Like
  • warren BJ
    , contributor
    Comment (1) | Send Message
     
    is snapchat is the new twitter? meaning TWTR going back to $30 a share? Snapchat, a rapidly growing messaging service, recently spurned an all-cash acquisition offer for close to $3 billion or more, what does it mean to stocks prices?
    9 Oct, 03:29 AM Reply Like
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