- Earnings per share up 63%
- Revenue forecasts exceeded
- 2019 expenses warning issued
Twitter Inc. posted fourth-quarter earnings yesterday that beat expectations, but the social media company warned of a sharp spending increase coming this year.
Twitter held user growth but warned investors that expenses would go up significantly in 2019 to protect the integrity of its platform.
Earnings were 31 cents per share for the three months ending in December 2018, marking a 63% increase from last year. The figure also beat widely predicted forecasts of 25 cents per share. Twitter said that group revenues saw a hike to total $909 million; the consensus forecast had been $868 million.
CEO Jack Dorsey said: “2018 is proof that our long-term strategy is working. Our efforts to improve health have delivered important results, and new product features like a single switch to move between latest and most relevant Tweets have been embraced by the people who use Twitter.”
“We enter this year confident that we will continue to deliver strong performance by focusing on making Twitter a healthier and more conversational service,” he added.
First-quarter revenue for 2019 is forecast by Twitter to be between $715 and $775 million, which is in line with industry predictions of $765 million. The company also said that GAAP and cash operating expenses would see a 20% increase from last year, reaching a range of $550 million to $600 million.
Pre-market trading following the earnings data’s release saw Twitter shares down 9.84%, pointing to an opening price of $30.80 each. This pushes the value of the stock past a dip of 10% over the last three months.
Twitter announced that it would end the monthly publication of its daily active user data after the first quarter of this year. Daily active user data for U.S. and international markets has been stopped immediately.