Friday, 7 February 2014

Not a good week for Twitter at all. Shares tank, Users stagnate, confidence disappears. But it's not all bad...

It's been a tough old week for Twitter.

In its first filings to Wall Street since their IPO, things have gone downhill. Investors are worried.

Twitter's US growth has largely stagnated and international growth is up 8 million users on the same yoy period. Small enough. 

Now with 187 m users internationally and 54m in the US, giving it 241m overall in Quarter 4 2013. In Quarter 3, that was 232m, so that's the worry because it's a small increase and USA stagnated. 

US Advertisers account for over 70% of Twitters revenue.

And it's all impacting on the share price.

Early stage poor growth like this, is really considered badly with the shares down circa -25% on the week. That's a massive offload.

It is only one quarter of data, and revenue in 2013 was 665 million usd, up from 317 million or +110% and EBITDA was up +256%. But these numbers never got a look in, so in some ways, the dissemination of information didn't help. 

Twitter still has a large advertising reach and it's still growing its users and its revenue. But the fluid typical ipo investors, may continue to depart and that's a problem.

IPO investors tend to be more 'punters' and get frightened easily. 

That's not good news for Twitter but it's likely that some maturity will come into the market in time....if that is, investors are prepared to wait.