Twitter notched its first profitable quarter
Social media company Twitter (TWTR) reported its 4Q17 earnings on Thursday, February 8. The company reported a quarterly profit for the first time.
Twitter generated revenues of $731.6 million, only 2.0% higher than in 4Q16. However, analysts were expecting revenues of $687.0 million. Twitter registered a profit of $91.1 million compared to a loss of $167.1 million in 4Q16. Twitter’s ad revenues, which comprise 85.0% of the company’s total revenues, grew 1.0% year-over-year (or YoY).
Twitter’s user growth remains a concern
Twitter (TWTR) said its monthly active users grew 4.0% YoY and its daily active users grew 12.0% YoY. However, on a sequential basis, its monthly active users of 330.0 million didn’t change from the previous quarter. Wall Street was expecting a higher number of monthly active users of 333.0 million.
The company’s first-ever profit buoyed the markets as Twitter’s stock price surged 12.2% on February 8, while the S&P 500 Index (SPX-INDEX) fell 3.5%. Twitter stock is up 25.7% year-to-date and a whopping 86.9% in the last six months.
However, Twitter stock is still 50.0% below the highs it made in its first two sessions after it went public. The surge takes Twitter’s valuation close to $25.0 billion.