Twitter (TWTR) Tops Q1 EPS by 3c, Cuts Guidance; Will Acquire TellApart

(Updated - April 28, 2015 3:39 PM EDT)

Following an earlier leak of the data, Twitter (NYSE: TWTR) officially reported its first quarter results just before markets closed Tuesday, while the release was originally slated to happen after the close of markets..

The social media giant reported Q1 EPS of $0.07, $0.03 better than the analyst estimate of $0.04. Revenue for the quarter came in at $436 million versus the consensus estimate of $456.82 million.

Monthly Active Users - Average Monthly Active Users (MAUs) were 302 million for the first quarter, up 18% year-over-year and compared to 288 million in the previous quarter. Average Mobile MAUs represented approximately 80% of total MAUs.

The data was in-line with earlier leaked numbers.

Outlook

Twitter's outlook for the second quarter of 2015 is as follows:

• Revenue is projected to be in the range of $470 million to $485 million. (The Street sees $538.2 million.)
• Adjusted EBITDA is projected to be in the range of $97 million to $102 million.
• Stock-based compensation expense is projected to be in the range of $190 million to $200 million, excluding the impact of equity awards that may be granted in connection with potential future acquisitions.

Twitter's outlook for the full year of 2015 is as follows:

• Revenue is projected to be in the range of $2.170 billion to $2.270 billion. (The company was previously modeling FY15 revenue of $2.3 billion to $2.35 billion and the Street currently sees $2.37 billion.)
• Adjusted EBITDA is projected to be in the range of $510 million to $535 million.
• Capital expenditures are projected to be in the range of $500 million to $650 million.
• Stock-based compensation expense is projected to be in the range of $750 million to $790 million, excluding the impact of equity awards that may be granted in connection with potential future acquisitions.

** Twitter also announced a partnership with Google's DoubleClick platform to improve advertising performance measurement and attribution for Twitter direct response marketers. As part of the partnership, Twitter will also make its inventory available through the DoubleClick Bid Manager, making it easier for clients who prefer to centralize their buying through DBM to create and manage campaigns on Twitter.

** The company also announced today that it has entered into a definitive agreement to acquire TellApart, Inc., a leading marketing technology company providing retailers and e-commerce advertisers with unique cross-device retargeting capabilities through dynamic product ads and email marketing.

Twitter's acquisition of TellApart reflects a continued investment in the company's direct response advertising capabilities both on and off of its owned-and-operated properties by giving the company additional tools for cross-device identity, targeting and attribution, along with a talented team with deep direct response expertise.

"Consumers now move fluidly between apps, devices and platforms, and performance advertisers are in need of more effective targeting and measurement tools that work seamlessly if, say, someone browses for products on a mobile device but ultimately makes a purchase on a desktop device," said Kevin Weil, Senior Vice President of Product at Twitter. "By bringing Twitter and TellApart together, we'll be able to help performance advertisers reach users wherever they are, whether on desktop or mobile."

"TellApart's strengths in personalization, dynamic product ads, commerce data and with retail advertisers are strong complements to Twitter's deep experience in mobile, understanding users and the app ecosystem," said Josh McFarland, co-founder and CEO of TellApart. "Together, we're excited to bring the power of cross-device targeted advertising to Twitter, our clients and our ad exchange partners."

Subject to the completion of customary conditions, the acquisition is expected to close on or around June 1, 2015.

For earnings history and earnings-related data on Twitter (TWTR) click here.

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