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Investing.com — Twitter sank almost 20% after adding fewer users than expected and forecasting a rise in costs.
MDAUs, or monetizable daily active users, grew 1% to 187 million, below the consensus of 195 million, according to StreetInsider. The company also said it expects costs and expenses to increase about 20% year-over-year in the current quarter.
Still, the company beat estimates, with earnings per share of 19 cents compared to the estimated 6 cents, on sales of $936 million, higher than the expected $769 million.
Despite the poor market reception, analysts from Barclays (LON:BARC) to Mizuho bumped up their price targets on the stock, according to StreetInsider.
The company said ad revenue grew 15% from a year earlier to $808 million. While many brands slowed advertising in the second quarter amid U.S. civil unrest, they increased spending quickly thereafter, and Twitter expects September revenue trends to continue or improve.
Susquehanna reiterated a positive rating on the stock, agreeing that momentum should continue through the current quarter.
“MDAUs were a little light of very elevated consensus expectations, but still extremely strong at 29% y/y growth,” analyst Shyam Patil wrote in a note, according to StreetInsider. “We remain buyers.”
JPMorgan (NYSE:JPM) said it also sees a strong recovery in brand ads continuing through the end of the year, reiterating a neutral rating.
