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These Are The Three Charts That Just Sent Twitter Plunging To All Time Lows

Tyler Durden's picture




 

In a repeat of last quarter, moments ago Twitter just reported strong earnings that beat expectations across the board, and guided higher:

  • Q1 revenue of $250.5 million, beating estimates of $241.5 million
  • Q1 non-GAAP EPS of $0.00, beating estimates of ($0.03)
  • Q1 adjusted EBITDA of $37 million, down from $45 million a quarter ago
  • Sees Q1 revenue of $270-$280 million
  • Sees 2014 full year revenue of $1.2 - $1.25 billion

In other words everything was great, with TWTR beating and the stock should be soaring right? Apparently, like last quarter, no.

Because the real pain is once again in the user data. To be sure, the stock was briefly higher until the algos scanned the earnings slidedeck and saw that TWTR had 255 million average monthly users, up just 25%, compared to growth of 39% and 30% in the last two quarters. Oops.

Just 3 million monthly active users added in the US in 1 quarter and 14 million in the entire world added in the quarter, missing again and well below the nearly 17 milion additions expected to a total 257MM.

Not pretty was the chart showing ad revenue per 1000 timeline views: at $1.44, it was also below the $1.49 achieved in the last quarter, although there may be a seasonal component here.

But the ugliest chart by far, was the one showing timeline view/MAU, which is TWTR's adopted methodology to sell advertising space. Barely changed for worldwide views/MAU at 614 from 613 in Q4, down in international and modestly higher sequentially in the US, all three metrics were solidly down year over year. 

And a bonus table from the company's selected financials with the troubling data highlighted:

 

Forget growth, Twitter now appears to have a major timeline view monetization problem which appears to be in broad decline.

End result: stock just dropped to new lifetime lows!

Slidedeck Source

 

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Tue, 04/29/2014 - 16:25 | 4709271 John McCloy
John McCloy's picture

  I love Twitter for news feeds and updates primarily ZH when im on the run..aside from that the question remains..HOW DO YOU MONETIZE IT? 

  Ask Zynga & Draw Something.

Tue, 04/29/2014 - 16:26 | 4709276 wallstreetapost...
wallstreetaposteriori's picture

All I know is that my june 43 call options are going to be hurting tomorrow morning.   Thought the stock would have priced all this in by now.

Tue, 04/29/2014 - 16:38 | 4709325 aVileRat
aVileRat's picture

Nope.

May want to plug that subscriber base into a decline model, and then talk to a marketing department on the brand attachment rate of 14-24 y/o's. cash per twit is negative, as is ROAC. Great product, but like MSN messenger and Yahoo chat, unless you charge per tweet or pump it full of ads like FB (or make it a premium service like Thompson Ikon/Bloomberg) the service is a pets.com.

Of course, paying for something is soooooo 1996. Big reason why this is 40% short interest right now is for that; and the $3B plug in the balance sheet in 2016. And the millions of funny munny options / insiders program selling as fast as they can. Go ask a San Fran recruiter, next to ATVI & FB, people are bailing hardcore on this corp.

 

Tue, 04/29/2014 - 16:41 | 4709335 TruthInSunshine
TruthInSunshine's picture

BTFD!

A still rising rising Fed Reserve Balance Sheet lifts all flotsam & jetsam.

Tue, 04/29/2014 - 16:47 | 4709362 max2205
max2205's picture

Really we all know twits is fucking retarded and stupid

Tue, 04/29/2014 - 17:03 | 4709422 Wolferl
Wolferl's picture

Gosh, are there still people out ther who think a company that doesn´t earn money is worthless?

Tue, 04/29/2014 - 17:21 | 4709484 James_Cole
James_Cole's picture

This negative sentiment is crazy, 30 yrs from now we're going to look back fondly on the early days of this brilliantly innovative company.

So what if they don't earn money? Where else can you write something in 140 characters or less and then have other people read your 140 characters or less post and then respond with their own post of 140 characters or less or repost your post. Earnings come and go, genius is forever. 

As long as they never deviate from this brilliance my dec 2014 $500 calls are well secure...

Tue, 04/29/2014 - 20:35 | 4710145 mrpxsytin
mrpxsytin's picture

Amen, brother. You will go far in the new religion. 

Tue, 04/29/2014 - 17:00 | 4709408 Soul Glow
Soul Glow's picture

Nominally, sure.

Tue, 04/29/2014 - 16:46 | 4709357 Vampyroteuthis ...
Vampyroteuthis infernalis's picture

All that I know is my June $25 put might be worth something now.

Tue, 04/29/2014 - 18:12 | 4709658 Mr Pink
Mr Pink's picture

Looks like Twitter is in the shitter

Tue, 04/29/2014 - 16:27 | 4709277 bam
bam's picture

time to setup some backspreads on twitter tomorrow

Tue, 04/29/2014 - 16:28 | 4709282 debtor of last ...
debtor of last resort's picture

Here's your dead canary.

Tue, 04/29/2014 - 16:30 | 4709290 Soul Glow
Soul Glow's picture

It's not dead!  It's just sleeping.  Give it more herion - it loves herion.

- Bernanke

Tue, 04/29/2014 - 21:41 | 4710403 StychoKiller
Tue, 04/29/2014 - 16:32 | 4709284 45Condor
45Condor's picture

Twitter strikes me as being predominantly a medium for twits to drop the i from their personality, and replacing it with an a.

Tue, 04/29/2014 - 16:29 | 4709286 Soul Glow
Soul Glow's picture

Damn it Twitter, you ruined the Tuesday euphoria!

Get to work, Janet!

Tue, 04/29/2014 - 16:29 | 4709288 Cacete de Ouro
Cacete de Ouro's picture

We will dig up Twitter, all of them, by the roots!

Tue, 04/29/2014 - 16:32 | 4709293 sessinpo
sessinpo's picture

To be called a twit is an insult (as in stupid). To be twittering (to tweet) is to be being stupid on purpose.

Stopped buying into these fads after myspace.

Tue, 04/29/2014 - 16:57 | 4709390 Squid Viscous
Squid Viscous's picture

don't forget past tense as in "Oh... my... god, like, I just twatted about that last week..."

Tue, 04/29/2014 - 19:42 | 4709952 Winston Churchill
Winston Churchill's picture

Miley twerts.

Tue, 04/29/2014 - 16:32 | 4709296 chuckroan
chuckroan's picture

Maybe below 20x annual revenues now!!!
Back up the truck!!!!!!!!
What a joke

Tue, 04/29/2014 - 16:33 | 4709306 drink or die
drink or die's picture

dat market saturation

Tue, 04/29/2014 - 16:34 | 4709308 Rainman
Rainman's picture

Even Icon took the pledge not to twatter his bullshit ever again .... sell !

Tue, 04/29/2014 - 16:35 | 4709310 Black Forest
Black Forest's picture

It is what was in the earnings slidedeck charts that is spooking the investors...

Which investors? Did I miss someone?

Tue, 04/29/2014 - 16:35 | 4709312 Wait What
Wait What's picture

Twittimber!!

Tue, 04/29/2014 - 16:35 | 4709313 bullmarket
bullmarket's picture

Sounds like Tyler is happy again, Why are you always happy when stocks go down? Would it be a better place if all stocks are at $1 - I persoanlly think not but that's just me.

As a side note, I own zero twtr and have no plans to buy. perhaps short?

 

Tue, 04/29/2014 - 16:41 | 4709333 The Most Intere...
The Most Interesting Frog in the World's picture

I would love to buy stocks at a dollar.  I think it would be a better world....

Tue, 04/29/2014 - 17:05 | 4709340 Dr. Engali
Dr. Engali's picture

It's not that stocks are up or down, it's because of the bullshit reason why they have such high valuations for companies that have little to no earnings and they continue to burn through cash. Some poor mom and pop that has been forced into the market thanks to the fed's policies is going to invest in these companies and get burned.

Tue, 04/29/2014 - 16:49 | 4709371 Vampyroteuthis ...
Vampyroteuthis infernalis's picture

BM, what most posters and Tylers on ZH want is a fair stock market. Not one that is manipulated with excessively high BS valuations. 

Wed, 04/30/2014 - 09:54 | 4711745 bullmarket
bullmarket's picture

What is high valauation? IS MSFT, INTC, aapl,CSCO, XOM, high valuation? The market is a bidding process. TWTR is high valuation based on future expectations. I would not say TWTR is the market. If you want to buy Companies the old fashion way of looking for cheap stocks that are growing their earnings at a reasonable rate and looking to make a reasonable return - no probelm - plenty to choose from. Keep some cash on the side look for pullbacks. Volaitity increases, be prepared.

If you want to get and get out, you better have a plan.

I do believe that the FEd went way to far and will pay the price. However, it is somewhat amazing how much money keeps coming in from other parts of the world.

2008 was 1929 in my books. So far the outcome has been better. I suspect there will be a price to pay but I don't know when. If not something else will happen.

I don't know what from a big picture what I would change. What country has done a better job?

 

 

 

 

 

 

Tue, 04/29/2014 - 17:10 | 4709450 Pareto
Pareto's picture

wow!  i'm so enlightened.

Tue, 04/29/2014 - 17:17 | 4709467 FuzzyDunlop21
FuzzyDunlop21's picture

Stupidity pisses me off and Im guessing it does the same to Tyler. I am not inherently happy when stocks go down, but I am happy when stocks get closer to what they are really worth. Its just that the market is so overvalued, when they go towards a rational valuation its usually in the downward direction.

What also pisses me off is that the market is so rigged, both for the profits of some already rich assholes and to make the sheeple complacent. If twitter crashing 20% wakes up a few people hell yes I am going to be happy

Tue, 04/29/2014 - 17:51 | 4709597 BlindMonkey
BlindMonkey's picture

BM, what does the acronym BTFATH mean to you? Does that even make sense? Why are we here?

Oh yeah, the Fed's printing press. Everything makes sense now. Carry on.

Tue, 04/29/2014 - 16:36 | 4709314 schooltruth
schooltruth's picture

I use it as a news source and to share comments re: markets.  I haven't had a "real" human follow my feed in over 3 mths.  Lots, and lots, and lots of bots taking over twitter.  If I were an advertiser I'd be running for the hills because in a couple of quarters all of their user metrics will be skewed by the presence of fake accounts (in a Facebook way though, it could be st-pos for the stock I guess).

If you want to advertise to kids - Instagram.

Grandma - Facebook.

everyone else? adwords

Tue, 04/29/2014 - 16:36 | 4709315 Squid Viscous
Squid Viscous's picture

Twitter - Exhibit #1 for why this market is a complete joke... I hope this causes all the "social media" stocks to shit the bed tomorrow...

Tue, 04/29/2014 - 16:36 | 4709318 The Most Intere...
The Most Interesting Frog in the World's picture

Not to mention these numbers are most likely complete BS and would make the numbers from BLS appear to be... well... accurate!

Fake it till ya make, no, sell it!!!

Tue, 04/29/2014 - 16:38 | 4709322 TruthTalker
TruthTalker's picture

I never understood how twitter was supposed to make money - do not think I ever paid attention to a single ad on there and I love ZH tweets and many others - am not a twit but a tweeter - the real twits are those that thought this was the place to invest their $

Tue, 04/29/2014 - 16:39 | 4709323 Dr. Engali
Dr. Engali's picture

The Rag Street Journal Headline:

Twitter's Revenue Surges While User Growth Picks Up

 

Marketwatch:

 

Twitter tanks as user growth falls short
Tue, 04/29/2014 - 16:42 | 4709324 no life
no life's picture

Mom and Dad and even Grandma are twittering it up now...  this stock should be shooting higher... lets go to over to Dickless to find out your money moves for the next three minutes!!!!  quick..

Tue, 04/29/2014 - 16:41 | 4709334 U4 eee aaa
U4 eee aaa's picture

Takes me back, makes me nostalgic for 2000

Yes kids, this is what it was like....except that it was a new or three nasdaq stocks doing this every day and the drops were tens of dollars

ahhh memories. Never though we'd see that again.

I can't wait for the robot tech bubble

Tue, 04/29/2014 - 16:44 | 4709346 infinity8
infinity8's picture

Wait, Twat?!

Tue, 04/29/2014 - 16:47 | 4709361 besnook
besnook's picture

polka dots are out. stripes are in. what a way to invest!

Tue, 04/29/2014 - 16:51 | 4709376 AndrewJacksonsGhost
AndrewJacksonsGhost's picture

So when is Disqus going public? They have been changing their model to be able to get advertising revenue so a IPO must be right around the corner.

Tue, 04/29/2014 - 16:58 | 4709401 Spawn of Cagliostro
Spawn of Cagliostro's picture

Bought me 1000 bot followers as an experiment the other day. Worked like a charm. Ridiculous! All these numbers are made up.  #howisthiscompanypublic?

Tue, 04/29/2014 - 16:59 | 4709402 davidalan1
davidalan1's picture

Lol...twitter, faceplant, instagram....reddit...here today gone tomorrow..give me a union carbide ....or better yet. B.a.s.f.

 

guess im getting old.....

Tue, 04/29/2014 - 17:32 | 4709538 Soul Glow
Soul Glow's picture

Time for Yellen to IPO a Tulip company.

Tue, 04/29/2014 - 20:24 | 4710103 MeelionDollerBogus
MeelionDollerBogus's picture

Reddit, gone tomorrow? You obviously don't understand the Internet.
4chan, twitter & reddit will be around a very, very long time.

Tue, 04/29/2014 - 17:13 | 4709445 GooseShtepping Moron
GooseShtepping Moron's picture

That classic sigmoid curve on the MAU chart sent the stock price, fittingly, into the sigmoid colon.

Tue, 04/29/2014 - 17:20 | 4709465 Agent P
Agent P's picture

#stillnotontwitter

#couldntcareless

#itscalledapoundsign

Tue, 04/29/2014 - 21:56 | 4710466 StychoKiller
StychoKiller's picture

#NoItsCalledAnOctothorpe

Wed, 04/30/2014 - 10:10 | 4711819 Agent P
Agent P's picture

#holyshitIdidnotknowthat

{Octothorpe}thankyou

Tue, 04/29/2014 - 17:25 | 4709504 QQQBall
QQQBall's picture

Goose Egg = Strong Earnings.... The end is near

Tue, 04/29/2014 - 18:09 | 4709548 JuliaS
JuliaS's picture

Monetization always drives people to seek greener pastures, but that's no problem. I think social networks have it all figured. The goal of a startup, typically, is to provide a free service through debt, in order to capture the largest number of "eyeballs", while marketing itself to investors on the back end. Then the company/service goes on an auction block, extinguishing some or all of the initial debt, allowing entrepreneurs to bail. Then the 1st tier investor crowd takes over the already hollw husk, and does cosmetic rennovations before dumping the product to the end-destination bag-holders.

The entrepreneur doesn't give a rat's ass about longevity. His goal is to grow as quickly as possible, debt be damned, bail early and move on.

The goal of first tier investor is to seek out hot commodities worthy of a quick "flip", like a mouldy house offering easy post-rennovation gains.

The mere fact a firm that has had no trouble growing prior to an IPO, hosts an IPO indicates that both, the creators and the insiders believe that the potential peak has already passed.

IPO's used to lift obscure and questionable companies off the ground. Today they're an equivalent of a celebrity funeral.

Tue, 04/29/2014 - 18:23 | 4709683 GooseShtepping Moron
GooseShtepping Moron's picture

I think you've got it just about right.

It's funny, though. You just described the business model that periodicals have been using for about 150 years. The print media's life cycle takes longer from start to finish, but it follows the same basic stages. Twitter and Facebook are the glossy magazines of the digital age.

Tue, 04/29/2014 - 17:46 | 4709585 Colonel Klink
Colonel Klink's picture

Twuck Fitter!

Tue, 04/29/2014 - 17:50 | 4709596 Randy Goodnight
Randy Goodnight's picture

I know a very smart guy that used to work for microsoft and analyze twitter feed data.  I think ms has a deal with twitter.  Says twitter is mostly used for bottom of the barrel lowlife's sending porn to each other.  Doesn't think the company will be around very long.  Sounds about right. 

Tue, 04/29/2014 - 20:22 | 4710094 MeelionDollerBogus
MeelionDollerBogus's picture

That doesn't make any sense.
People can email each other, or go phone to phone for that.
For high quality porn there's torrents & commercial sites. Those commercial sites have many porn stars & they are on twitter. They put their pictures up & include ads for videos they are in & for strip clubs they will be featured at, adultcon expos, etc., and I'm sure that makes money.
Your friend doesn't sound very smart to me. There is no question a lot of people use twitter & like it.
The only question is how Twitter will make money from it.
When a porn star rakes in mad cash from publicity, and some of it's on twitter, twitter owns zero from that. So how will they advertize to get money?

Tue, 04/29/2014 - 18:49 | 4709767 LooseLee
LooseLee's picture

"the service is a pets.com."

 

This pretty-much says it all...

Tue, 04/29/2014 - 19:25 | 4709881 22winmag
22winmag's picture

What else would you expect from a microblogging site that was briefly relevant a few years back when using old-fashioned text messaging to update your feed made sense because smartphones were in their infancy?

Tue, 04/29/2014 - 20:16 | 4710075 MeelionDollerBogus
MeelionDollerBogus's picture

Twitter seems incredibly relevant for entertainers, for news reporting, for science updates, tons of things.
Brief, to the point, links to other people & to stories, or just posting pictures.
But I've never seen an ad on it ever so I have no idea how they're going to make money from it.

Tue, 04/29/2014 - 19:49 | 4709988 Herdee
Herdee's picture

It all depends on how much tapering the market can take.Coming into May,I wouldn't be buying right now,too many days of high volatility tells me the market is jumpy and nervous.

Tue, 04/29/2014 - 19:55 | 4710007 MeelionDollerBogus
MeelionDollerBogus's picture

Wait, twitter has ads? Where?

Tue, 04/29/2014 - 19:59 | 4710024 Dadburnitpa
Dadburnitpa's picture

What's twitter?

Wed, 04/30/2014 - 10:27 | 4711888 Bernoulli
Bernoulli's picture

Hey Dorsey: I'm quite surprised you didn't explain the drop in ad revenue/1000 timeline views further:

It's clearly weather-related, so not your fault! Everybody can see that. Correlates perfectly with Q1 first time real estate buyers going down, Mc Donalds mc happy meal sales declines and also UPS deliveries being "awfully" hit by cold weather.

Duhh!

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