Twitter Inc Share Price: Weak Q4 Data Pushes TWTR to Fresh Lows, But Active Advertising is Up Almost 90%


Wednesday saw Twitter reveal Q4 and Fiscal Year 2015 figures that were weaker than expected.

The company revealed in their shareholder letter that monthly active users (MAUs) excluding SMS-only users were 305m for the fourth quarter, down from the 307m in the previous quarter.

On usage the company revealed, "we saw a decline in monthly active usage in Q4, but we've already seen January monthly actives bounce back to Q3 levels. We're confident that, with disciplined execution, this growth trend will continue over time."

Fourth quarter revenue totalled $710m for the quarter, a 48% increase compared with the previous years $479m.

International revenue totalled $247m, an increase of 51% year-over-year however, advertising revenue hit $641m, a 48% yearly increase.

The news saw Twitter share price drop over 10% in after-hours trading on Wednesday.

Twitter Inc (NYSE:TWTR) share price has struggled in 2016, dropping a mighty 35% year-to-date, and almost 70% over the last 12 months.

Yet not all the news is negative as Associate Professor of Strategic Management, Dr Sotirios Paroutis said:

"Not being able to add any new active users in the last quarter will disappoint some, particularly investors, yet it did see active advertisers go up by almost 90% year on year. Plus, historically, Q4 has been a slow quarter for Twitter, while in 2016 the US elections and the Olympics will be two big events that will be expected to help push their active users up.

"Twitter has delivered a number of product innovations, but these need to be less confusing for core users and attractive enough for new users.

"The focus on ‘live’ and experiencing live events is a clear effort to explain Twitter to a wider audience, particularly the ones who haven’t experienced it before. This allows Twitter to connect multiple products when single events happen – making Twitter a more appealing option for advertisers. It also allows them to build a distinctive identity versus other social media offerings."

MarketBeat has reported fresh analyst reports today including, Barclays who reaffirmed their hold rating, but lowered their price target from $33 to $19. Mizuho also lowered the price target on their buy rating from $21 to $15.