The company added 14 million monthly active users in the first quarter this year, up 6% from the last quarter. Twitter reported its first-quarter earnings today.
Eric Gaillard / Reuters
Twitter CEO Dick Costolo seems convinced that Twitter already is mainstream. Wall Street seems to disagree.
The company reported its first-quarter earnings today, which included beating analyst estimates on both revenue and earnings. But investors still sent the stock tumbling more than 8% in extended trading after the release came out, as it only added 14 million users in the first quarter this year. That drop alone sent Twitter's market cap down by about $2 billion.
At the time of Twitter's last earnings call, Twitter's core business (much the same this quarter) seemed to be performing fine — but it became clear it was having trouble attracting new users. That's important for Twitter's business, because in order to grow, it needs to both attract new users and find better ways to target advertisers. Twitter's shares as of this morning were down more than 35% on the year, most of that decline coming after its first earnings report.
Twitter has received some criticism as to whether it can become a "mainstream" service much in the same way Facebook has become accepted as a household name. But on the earnings call, Costolo essentially said that he believed Twitter — based on certain events like the Oscars, which resulted in more than 3.3 billion tweets in the 48 hours following the event — had already reached "mainstream" status like other large services.
"The beauty of Twitter the platform today is that we had 3.3 billion views of Tweets just about the Oscars in the 48 hours after," Costolo said on the call. "That's a big number, if you think about that in the context of YouTube [channels]... I think we think of YouTube as a mainstream platform."
At the end of the first quarter, Twitter had 255 million monthly active users, up from 241 million at the end of 2013. The company's monthly active users are up 25% from the same quarter last year and up 6% from the last quarter. Of those, 198 million were checking the service from their mobile devices, also up 31% in from the same quarter a year ago.
Additionally, Twitter's "Timeline Views" — which can be used as a proxy for engagement — were up about 15% from the same quarter a year ago to 157 billion in the first quarter this year. Sequentially, timeline views were also up: Twitter had 148 billion timeline views in the fourth quarter of 2013, an increase of about 6% quarter-over-quarter. Advertising revenue per thousand timeline views was $1.49 in the fourth quarter of 2013, and down to $1.44 in the first quarter of 2014.
Sequentially, Twitter's Q1 2014 represents a slight improvement over the last quarter — but it's still apparently not enough.
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