Twitter has unveiled disappointing results for the first three months of 2015 following what it described as “a lower-than-expected contribution from its newer direct response products. The company said it expected this revenue impact to continue for the remainder of the fiscal year. Shares in Twitter fell 18 per cent at the close of trading on the back of the results.
The firm generated revenues of $436m (£284m) during the quarter – it had previously forecast revenues of £440-$450m - and posted a loss of $162m, compared to a loss of $132.4m in the first three months of 2014. It said it expected the negative impact on its revenue to continue for the rest of the financial year. There was some cheer from Twitter, however, in its monthly active user numbers, which rose 18 per cent year-on-year to 302m in the first quarter. 80 per cent of these were mobile.
"It is still early days for these products," said Twitter chief executive Dick Costolo. “We have a strong pipeline that we believe will drive increased value for direct response advertisers in the future. We remain confident in our strategy and in Twitter's long-term opportunity, and our focus remains on creating sustainable shareholder value by executing against our three priorities: strengthening the core, reducing barriers to consumption and delivering new apps and services."
Twitter also announced two moves designed to strengthen its direct response capabilities. Firstly, it has struck a deal to acquire TellApart, a marketing tech firm specialising in cross-device retargeting via advertising and email marketing.
Twitter also unveiled 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 (DBM) making it easier for clients who prefer to centralize their buying through DBM to create and manage campaigns on Twitter.