Twitter released its first quarter financial results on Thursday to receive mixed feedback from investors. The social media giant announced that its total revenue reached $ 1.04 billion for the first quarter, up 28% year over year. Ad revenue alone was $ 899 million, with total ad orders increasing 11% year over year and cost per order increasing 19% year over year.
Post labeled the company’s outlook for the second quarter as confusing, arguing that the call should have been higher as management pointed to a rebound in brands’ spending in March. The company said sales are expected to be between $ 980 billion and $ 1.08 billion, while Wall Street consensus believed the value should be $ 1.06 billion.
Wedbush analyst Ygal Arounian wrote in a note on Friday that he believes Wall Street will focus on slowing user growth and that investors are increasingly focused on whether users will continue to use apps such as: Twitter now that the pandemic in the underground is receding.
In a note titled “This birdie finds air turbulence,” MKM Partners analyst Rohit Kulkarni called it a mixed quarter for Twitter. He said ad revenue growth appeared to be lagging behind those of Pinterest (PINS) and Snap (SNAP), which reported in early April. He, too, has noticed that Twitter user growth has been softer than expected.
“While yesterday’s results don’t instill confidence in management’s ability to maintain a steady cadence of fundamentals, we think Twitter remains a solid reopening game with live sports and summer events, ”wrote Kulkarni.
Oppenheim-based analyst Jason Helfstein also looks to the return of live events and says their suspension has weighed on sales growth. “While the market reacted to the weaker outlook for the second quarter after the optimistic investor day, we are more optimistic about the product cadence and expect brand strength,” wrote Helftstein in the second half of 2021.
The company also expects its workforce to grow 25% or more year over year in 2021, “resulting in an increase in the absolute dollar over the course of the year.” At the end of the report, optimistic claims were made that total sales will grow faster than spending this year, assuming the global pandemic continues to improve.