Twitter Misses on Earnings, Revenue, and User Growth in Q4

Social media giant Twitter was on a mission to disappoint as the company missed earnings expectations all across the board for the fourth quarter.

The company reported earnings for the fourth quarter on Thursday, the first under new CEO Parag Agrawal after Jack Dorsey stepped down this past November. Agrawal previously served as chief technology officer,

While Twitter shares initially rose on the report, they ended up falling 2% by the end of the day.

For the quarter, the company reported earnings per share of 33 cents adjusted. This was compared to the 35 cents that was expected according to a Refinitiv survey of analysts.

Revenue at $1.57 billion was below the $1.58 billion that was expected, according to Refinitiv.

Looking ahead, Twitter provided revenue guidance for the next quarter ranging from $1.17 billion to $1.27 billion, while analysts had expected about $1.26 billion, according to Refinitv.

The company has also authorized $4 billion in share buybacks. Half of that will be an accelerated share repurchase with the remaining being repurchased over time, the company said.

CFO Ned Segal said in a statement in the earnings release that its previously stated goals of reaching 315 million mDAUs in Q4 2023 and at least $7.5 billion in revenue in 2023 remained the same.

According to Segal, revenue in Q4 was impacted by a slowdown in advertiser spending in the last couple of weeks of the period. But he said spending has picked up moving into Q1.
Agrawal aims to grow Twitter to 315 million monetizable daily active users by the end of 2023.

Agrawal said on Twitter’s earnings call that the company still believes it can meet those 2023 goals because it’s seen a significant increase in new account sign-ups and reactivations. The company said it’s seen 25% year-over-year growth in new account sign-ups or reactivation and a 35% year-over-year increase in daily sign-ups.

Segal told analysts on the company’s earnings call that the surge in new sign-ups is driven in part by strategies like encouraging users to sign in when they come to Twitter from a different platform. The CFO believes the new users “look a lot like the people who have come to Twitter in the past, there’s just more of them.”

Disclaimer: We have no position in any of the companies mentioned and have not been compensated for this article.