Twitter earnings look: Eyes on competition, user growth

|By:, SA News Editor

Twitter (NYSE:TWTR) reports earnings in the morning, with investors looking for clues to what has become a more hotly competitive space for advertising, and some indication as to how the company will monetize further.

Capital IQ consensus is for EPS of $0.01 on a non-GAAP basis, on revenues of $513M, which would be its first Y/Y revenue drop (of about 14%).

With M&A looking less likely, MKM Partners suggests, demonstrating audience momentum will be critical, particularly if the company can switch emphasis to daily active users and hit high single digits (at least). The company had DAU growth of 11% in Q4, but that pace likely slowed to around 7%.

Meanwhile, options movements are implying a 9% move in common stock, below a historical average of 12.4%, Bloomberg notes. Total call open interest is down 6% and total put open interest down 12% since April 10; the most widely held April 28 contracts are $16 calls, $15 calls and $15.50 calls.

Twitter closed today down 0.3% at $14.66; shares are down 10.1% YTD.