Like its bigger tech peers, Twitter posted stronger-than-expected results for the first quarter on Thursday. But its lukewarm outlook sent shares tumbling after hours.
The San Francisco-based company earned $68 million, or 8 cents per share, in the January-March period. That’s up from a loss of $8.4 million, or 1 cent per share, a year earlier.
Revenue grew 28% to $1.04 billion. Analysts, on average, were expecting a loss of 2 cents per share on revenue of $1.03 billion, according to a poll by FactSet.
In a tumultuous start to the year, Twitter permanently suspended its arguably most powerful and polarizing user - former President Donald Trump - from its platform in January after the deadly riots at the U.S. Capitol.
It had also suspended more than 150,000 other accounts across its platform for what it described as “propagating a conspiracy theory” linked to dangerous behavior offline. Primarily these accounts were linked to QAnon, the unfounded conspiracy theory that claims Trump is waging a secret battle against the “deep state” and a sect of powerful devil-worshipping pedophiles.
While the suspensions irked certain users, Twitter executives insist they want a “healthy conversation” on the platform and are willing to take some heat for enforcing rules.
“When it comes to the Twitter Rules, we recognize that politicians and government officials are constantly evolving how they use the service, and we want our policies to remain relevant to the everchanging nature of political discourse on Twitter,” the company said in a statement Thursday. To this end, Twitter is seeking public input on its rules.
Twitter had 199 million daily users, on average, in the third quarter, up 20% year-over-year and slightly below the 200 million that analysts were expecting.
By comparison, Facebook had 1.88 billion daily users on average in March 2021, an increase of 8% year-over-year. Snapchat, meanwhile, had 280 million average daily active users in the first quarter.
Twitter does not disclose monthly user figures.
Twitter said it expects revenue between $980 million and $1.08 billion for the second quarter. The midpoint of that is below analysts’ expectations of $1.06 billion.
Twitter’s stock fell $6.21, or 9.5%, to $58.88 in after-hours trading.
This story has been corrected to use a comparable FactSet estimate of a two cent per share loss, according to generally accepted accounting principles.
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