John Meyer, managing partner of Starship Capital, on the future of Twitter and Lyft following their recent earnings reports.
After Twitter kicked former President Donald Trump off its platform a month ago, he announced Tuesday that he gained more daily users in January than the average number he added over the past four years in that month.
While some critics expected a decline in users after the ban on Trump, Twitter CEO Jack Dorsey told analysts on Tuesday: “We are, of course, a platform that is much bigger than any topic or account.”
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Although the bulk of Twitter’s earnings were devoted to the last quarter of the year, the company generated more than $ 1 billion in revenue, but Twitter took the unusual step of offering leadership growth for the current quarter. The company did so because of the circumstances surrounding the suspension of the former president of the platform following the January 6 attack on the US Capitol by groups of his supporters and following two tweets he made, which according to the company violated is with his glorification of the policy of violence.
Although it does not provide a figure for the new users added in January, the company noted that daily users climbed to 192 million from 187 million in the third quarter, helped by one million new users in the US. The local market also had the largest share of revenue in the fourth quarter of $ 1.29 billion. The US was responsible for $ 733 million well for a year-on-year increase of 24%.
International revenue rose 34% to $ 556 million, with revenue from Japan, the social media giant’s second largest market, up 26% to $ 176 million, or 14% of total revenue.
In terms of advertising revenue, the company reported a 31% increase to $ 1.15 billion for the quarter, with total advertising engagement growing by 35% over the same period. Data licensing and other revenue increased 9% to a total of $ 134 million. Mobile application promotion (MAP) advertising totaled more than $ 300 million in the 2020 financial year, approximately year-on-year. However, MAP revenue for the quarter increased by 50% year-on-year. The company also announced the launch of its rebuilt MAP offering and website clicks, which, according to the company, “will increase our responsive market and diversify our customer base.”
After hours, the stock is trading more than 2%.
Operating income is $ 252 million, or 20% of total revenue, compared to $ 153 million, or 15% for the same period in 2019.
Total expenses and expenses for the quarter grew to $ 1.04 billion in the fourth quarter, with the cost of revenue driven by acquisition costs, the share of partnerships and public cloud-related expenses, 38% to $ 433 million, research and development expenses, which increased by 25% to $ 248 million due to higher personnel-related costs, sales and marketing expenses, which increased by 1% to $ 244 million due to increased outsourcing and higher sales-related expenses, and general administrative expenses by 12 % to $ 112 million, mainly due to higher staff-related costs.
In addition, the compensation cost on shares grew by 27% to $ 128 million, representing approximately 10% of total revenue.
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Twitter closed the fourth quarter with more than 5,500 employees worldwide and approximately $ 7.47 billion in cash, cash equivalents and marketable securities.
Net cash for the quarter was $ 330 million, an increase of $ 277 million in the same period last year, while capital expenditure for the quarter was $ 292 million, compared to $ 150 million in the same period last year, driven by infrastructure investments in the data center. extensions to support audience growth and product innovation. ‘The adjusted free cash flow for the quarter was $ 38 million, compared to the adjusted free cash flow of $ 127 million in the same period last year.
| Ticker | Safety | Last | Alter | Alter% |
|---|---|---|---|---|
| TWTR | TWITTER INC. | 59.87 | +1.67 | + 2.87% |
In addition, the company launched a share repurchase program in the fourth quarter, bringing in a total of $ 251 million of its share during the quarter. The company plans to repurchase a total of $ 2 billion worth of Twitter shares over time to maintain an appropriate capital structure, offset stock dilution and return capital to shareholders. ‘
“Our pace in future quarters is likely to be lower and may vary depending on the operating environment, our capital needs and market conditions,” Twitter said in its shareholder letter.
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Looking ahead, the company expects to increase its staff by more than 20% by 2021, especially in the fields of engineering, products, design and research. However, the company expects total costs and expenses to grow by 25% or more in 2021.
Twitter expects total revenue for 2021 to grow faster than spending, assuming the pandemic continues to improve and given the expected ‘modest impact’ of Apple’s upcoming privacy changes to iOS 14. In the first quarter of 2021 estimates the company that revenue will grow. between $ 940 million and $ 1.04 billion and operating income between a loss of $ 50 million and breakeven. For the 2021 financial year, Twitter expects inventory-based compensation costs to be between $ 525 million and $ 575 million and capital expenditures to be between $ 900 million and $ 950 million.