Twitter’s first post-IPO earnings report is due on the close of business today and, with the company’s stock up more than 150 percent above its IPO price and hovering bullishly not far from all-time highs, investors are eagerly awaiting something from Twitter that will justify its fairly loft valuation.
Two things to watch in this earnings report are signs of growth in overall ad revenues, and also a boost in total user base numbers.
Analysts have projected that Twitter’s quarterly revenue will more than double to $218 million but that the company’s losses will also mount, with a 2 cents per share loss forecast. If growth slows or losses are worst than expected the stock will likely take an immediate hit.
Equally, investors will want to see gains in Twitter’s stagnating user base, which hit 232 million active users last year but hasn’t really expanded significantly in two quarters. Personally I think if that number is less than 250 million something is off, as Twitter had an absolute ton of positive publicity towards and after the IPO, so lots of folks should have been checking it out for the first time. If they didn’t, or if they didn’t stay, that would have to be seen as a negative.
Conversely, a solid boost in user numbers and stronger than expected ad revenue numbers could see the Twitter stock have another look at the $74.73 Christmas peak in the interim.
(Twitter chart: Yahoo.)