Twitter Inc forecast first-quarter revenue below Wall Street estimates and reported a drop in users for the fourth quarter on 7 February, sending its shares down 8 percent in early trading.
The social media company said its monthly active users declined due in part to its campaign of deleting millions of abusive accounts after facing criticism it was being used as a platform for political manipulation and hate speech.
For its current quarter, Twitter said it expected total revenue to be between $715 million and $775 million. The midpoint of that range was below analysts' average estimate of $765 million, according to IBES data from Refinitiv.
The company, however, reported a better-than-expected 24 percent increase in fourth-quarter revenue, helped by growth in its video advertising business.
Representational image. Reuters
Overall revenue rose to $909 million in the quarter, beating the estimate of $868.2 million.
Total advertising revenue rose 23 percent to $791 million. More than half that revenue came from video ads placed by corporate clients.
Revenue from data licensing and other non-advertising businesses rose 35 percent from a year earlier to $117 million.
Excluding some items, Twitter reported a quarterly profit of 31 cents per share, beating the average estimate of 25 cents.
The number of average daily active users exposed to Twitter ads, a new figure disclosed by the company, rose to 126 million in the fourth quarter from 115 million a year ago and 124 million in the previous quarter.
It expects capital expenditures to be between $550 million and $600 million, well above analysts' average estimate of $415 million for 2019.