Twitter’s stock plummeted in after-hours trading after the company reported revenues of $595m, at the lower end of its forecast, as advertisers didn’t spend as much as expected.
“Total revenue was at the low end of our forecasted range of $595m to $610m due to slower than expected growth in brand advertising spend,” the company confirmed in a letter to shareholders.
Total advertising revenue grew 37pc year-on-year.
The company said that revenue growth year-on-year from large brand advertisers was softer than expected while revenue growth from small and medium-sized businesses was the fastest.
‘We see a clear opportunity to increase our share of brand budgets over time’
Revenue from video format ads tripled year-on-year.
The micro-blogging site ended the quarter with $3.6bn in cash and had a cash flow of $99m.
Twitter reports user growth
Total monthly active users were 310m for the quarter, up from 305m in the previous quarter. Mobile monthly active users represented 83pc of Twitter’s user base.
Looking ahead to Q2, Twitter said it expects revenues of between $590m and $610m.
EBITDA was $180m, up 73pc year-on-year. Despite this, the company reported a net loss of $80m.
“We see a clear opportunity to increase our share of brand budgets over time,” Twitter told shareholders.
“We have a strong product roadmap designed to tap into incremental brand-oriented online video budgets, and will deliver additional features for advertisers later this year — including more detailed demographic targeting and verification, and reach and frequency planning and purchasing.”
Twitter image via Shutterstock