Social network firm Twitter (TWTR) announced its Q3 earnings after the bell on Monday. Revenues in the quarter of $361 million beat the Zacks consensus estimate of $358 million, though earnings of -27 cents per share (GAAP, adjusted for stock-based compensation) met the -27 cents we had expected. But growth trajectories remain fairly robust overall, and notwithstanding its disappointing forecast for Q4 revenues, that's the main story for Twitter these days.
Monthly Active Users (MAU) were up 4.8% sequentially and 23% year over year in the quarter to 284 million. Timeline views reached 181 billion, which is up 14% from the year-ago quarter. And Twitter's Advertising Revenue Per 1000 Timeline Views hit $1.77 in the September quarter, up 83% year over year.
Guidance, as I mentioned, for the December quarter was much lower than expected: a range of $440-450 million in the December quarter is beneath the Zacks consensus estimate of $469 million. Also, though growth trajectories still appear formidable, they do appear to be losing a bit of steam compared to previous quarters, especially its Q2 2014 — though that quarter was helped tremendously by FIFA World Cup soccer over the summer, during which Twitter enjoyed a big boost is users and activity.
The reason for Twitter's big sell-off in the after-market, even though quarterly numbers were pretty much along the lines of what was expected, may have something to do with the fact that Twitter has yet to tie its various acquisitions together into what can be viewed as a viable platform system that may be able to take market share from companies like Facebook (FB) and LinkedIn (LNKD). Smaller companies acquired by Twitter include Cover, Gnip, TapCommerce and others, but just how these various systems will eventually intertwine to enhance the Twitter experience isn't very clear at this time.
Thus far in late trading, TWTR shares are down 9%. As of the closing bell, Twitter was down roughly 24% year-to-date, including the big positive surprise in Q2.
Perhaps this sell-off is mostly just a rather aggressive strain of profit-taking now that the company's 60% run up since its 52-week lows this past spring has passed.
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