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Record-breaking $502m in sales, BIG LOSSES – OF COURSE IT'S TWITTER
Who else, who else could turn half a billion dollars into nothing
Twitter has managed to collect over half a billion dollars - and somehow throw it all away and more even though it does nothing but run a microblabber portal. But the markets are impressed anyway.
The company brought in $502m for the second quarter of its fiscal 2015, which ended on June 30. The figure represented a 60.9 per cent sales increase from the same period a year ago and it outperformed Wall Street's prognoses by around 4.4 per cent.
Similarly, Twitter posted earnings for the quarter of $0.07 per diluted share, which was on the high side of what the analysts were expecting.
Actual profits continue to elude the service, however. It posted a net loss for Q2 of $136.66m, compared to a net loss of $144.64m for last year's quarter.
In a statement [PDF] accompanying the results, interim Twitter CEO Jack Dorsey – who took the reins of the company when outgoing chief exec Dick Costolo resigned in June – said that while the money side of the business is looking good, he's still not satisfied with its audience growth rate.
Twitter reported an average of 316 million monthly active users (MAUs) for the quarter, which was up 16.6 per cent year-on-year and up 2.6 per cent from the previous sequential quarter. Mobile MAUs grew slightly faster, up 19.8 per cent annually, for a total of around 253 million.
By comparison, however, this time last year the company reported MAUs were up 24 per cent from Q2 of 2013, and mobile MAUs were up 29 per cent annually.
That slowing audience growth rate should be worrying for Twitter, which derived 88 per cent of its second-quarter revenue from advertising.
"In order to realize Twitter's full potential, we must improve in three key areas: ensure more disciplined execution, simplify our service to deliver Twitter's value faster, and better communicate that value," Dorsey said.
Unfortunately, Dorsey will face a couple more hurdles in making that happen. Just before Twitter announced its second-quarter numbers, Christian Oestlien, its VP of product management, and Todd Jackson, its product director, both announced their resignations (via Twitter, naturally). Oestlien is headed for YouTube, while Jackson is taking a position at Dropbox.
But investors seemed pleased with the results, and Twitter's share price climbed by more than 5 per cent on the news and continued upward in after-hours trading. ®