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The Bubble Hasn't Popped Yet: Twitter Earnings and Stock Price Soar
Scott Lucas | Photo: Courtesy Wikimedia Commons | July 29, 2014
But CEO Dick Costolo comes in for heavy criticism.
Expect a bunch of people buying drinks for the house at Alta CA tonight. That's because Twitter released its quarterly earnings report today, and it wasn't at all horrible! The Mid-Market tech giant announced sales of more than $300 million in the last quarter, beating expectations by far. This marked its fourth consecutive quarter of accelerating revenue growth. After the news, the company's stock price surged more than 35 percent.
Twitter's quarterly loss was $144.6 million—24 cents a share—on revenue of $312.2 million. After taking into account employee stock compensation, the company made a profit of $14.6 million—2 cents a share—beating analyst prediction of a loss of one cent a share after those adjustments.
Bottom line: Twitter is back, baby (to its pre-IPO valuation)! On the earnings call with analysts, CEO Dick Costolo crowed, "We had a strong quarter and made progress on multiple fronts. Our financial performance was truly exceptional." In advance of the earnings call, however, Costolo came in for criticism by users of the social networking company, when he took to CNBC to field questions in real time for users, who had submitted them using the hashtag #askcostolo. New York Times' writer Mike Isaac submitted the Reddit staple: "Would you rather fight 100 duck-sized horses or one horse-sized duck?" Others asked if he preferred his coffee at Philz or Sightglass. Our favorite was the one asking Costolo if he was internet commentator's favorite weird replacement for @horse_ebooks, @darth.
But it wasn't just free-range joking that met Costolo in the Q and A. There were also a number of questions about Twitter's controversial policies over online harassment. Mother Jones editor Clara Jeffery wrote to Costolo, " I once got threats so bad they got written up in @nytimes & @SFGate. Only then did @Support take action and that action was to speed verification. An option not available to most people. Do better." Other commentators lambasted Twitter for its lack of diversity in its workforce.
Costolo—or more likely, the producers at CNBC—didn't let the complaints, both jocular and real—rain on the parade, though, with Costolo instead fielding questions on things like typos. Oh well. If you really want those answered, we suggest staking out the back rooms at Tosca or the Cavalier tonight.