Social media giant Twitter, Inc. (TWTR) reported Friday a net loss for the second quarter compared to a profit last year, hurt by a decline in revenues and a surge in costs and expenses. The results also missed analysts’ expectations.
For the second quarter, San Francisco, California-based Twitter reported a net loss of $270.01 million or $0.35 per share, compared to net income of $65.6 million or $0.08 per share in the prior-year quarter.
Excluding items, adjusted net loss for the quarter were $0.08 per share, compared to adjusted net income of $0.20 per share in the year-ago quarter.
On average, 16 analysts polled by Thomson Reuters expected the company to report earnings of $0.14 per share for the quarter. Analysts’ estimates typically exclude special items.
Revenues for the quarter declined 1 percent to $1.18 billion from $1.19 billion in the same quarter last year. Revenues increased 2 percent on a constant currency basis. Analysts had a consensus revenue estimate of $1.32 billion for the quarter.
The revenues decline reflected advertising industry headwinds associated with the macroenvironment as well as uncertainty related to the pending acquisition of Twitter by an affiliate of Elon Musk. When excluding MoPub and MoPub Acquire, year-over-year growth was 3 percent.
Advertising revenues grew 2 percent to $1.08 billion from last year, while subscription and other revenue declined 27 percent to $101 million year-over-year.
Average monetizable daily active users (mDAU) for the quarter grew 16.6 percent to 237.8 million from last year, driven by ongoing product improvements and global conversation around current events.
Average US mDAU grew 14.7 percent to 41.5 million from last year, and average international mDAU were 196.3 million for the quarter, up 17.0 percent from last year.
Costs and expenses surged 31 percent to $1.52 billion, driven by about $33 million in costs related to the pending acquisition of Twitter and $19 million in severance-related costs.
Twitter has filed a lawsuit against billionaire entrepreneur Elon Musk related to the termination of the $44 billion acquisition deal. The trial is set to start in October.
In late April, Twitter agreed to accept Musk’s offer for $54.20 per share in cash to become a privately held company. However, in May, Musk put the Twitter acquisition on hold, demanding further information about spam and fake accounts.
Later, Musk’s legal team said earlier this month it is backing off from the deal as the social media company has not complied with its contractual obligations, and did not provide relevant business information.
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