Twitter stock falls after light outlook, plans to phase out monthly-active-user metric
Twitter Inc. shares are down 8% in premarket trading after the company beat expectations with its fourth-quarter financials but delivered a light outlook for the current quarter and announced plans to do away with the monthly-active-user metric. The social-media company posted net income of $255 million, or 33 cents a share, up from $91 million, or 12 cents a share, a year earlier. Twitter said this marked the company's first full year of GAAP profitability. The company expects its GAAP tax rate to be higher than its cash tax rate "for the foreseeable future" until the company finishes using its large net operating loss carryforwards. Adjusted EPS climbed to 31 cents from 19 cents in the year-ago period and came in ahead of the FactSet consensus, which called for 25 cents. Revenue rose to $909 million from $732 million a year earlier, while analysts had been modeling $866.7 million. Twitter's average monthly-active-user count dropped 5% on a sequential basis to 321 million people. This was roughly in line with the FactSet consensus. The company said the metric was impacted by a change in how Twitter sends email notifications as well as "decisions we have made to prioritize the health of the service." Twitter plans to stop reporting monthly active users after the first quarter of 2019. The company will instead disclose "average monetizable daily active users." Twitter's average monetizable daily active users rose 9% to 126 million, the company said. It expects first-quarter revenue of $715 million to $775 million, whereas analysts had been expecting $765 million. The company projects full-year capital expenditures of $550 million to $600 million. Shares have dropped 2.4% over the past three months, as the S&P 500 has slipped 2.9%. Market Pulse Stories are Rapid-fire, short news bursts on stocks and markets as they move. Visit MarketWatch.com for more information on this news.