- Twitter posts first-quarter earnings of 16 cents per share and revenue of $655 million, beating analysts' expectations.
- It's Twitter's second-straight profitable quarter, and its second profitable quarter ever.
- The company also projects a profitable 2018.
- Advertising revenue is growing, especially as budgets shift from television to digital.
Twitter shares were up as high as 13 percent before paring gains after the company reported revenue and earnings that beat expectations Wednesday.
Here are the first-quarter earnings and revenue versus analyst expectations:
- Earnings per share: 16 cents vs. 12 cents projected by a Thomson Reuters survey of analysts
- Revenue: $655 million vs. $608 million expected by the Reuters survey
- Monthly active users: 336 million vs 334.2 million expected by StreetAccount and FactSet
It was Twitter's second-straight profitable quarter. It also showed a profit in the fourth quarter. Revenue from the latest quarter was up 21 percent year over year, and the company expects to be profitable for 2018.
"Our message is really resonating [with advertisers]," Twitter CFO Ned Segal told CNBC. "Sentiment is much better, the ROI that they are seeing from their advertising on Twitter is much better based on lower cost per engagement and more ad engagement and more ad engagement, and that causes them to put more money onto the platform than they might have before."
Analysts expected Twitter to be profitable due to increasing advertising revenue, especially because digital advertising budgets are rising as marketers shift money over from television. The company also showed huge growth in international ad revenue, especially from China and Japan.
"Video is now more than half our ad revenue," Segal said. "This is the second quarter in a row where that's been the case. There is still a lot more room to improve that as we get more video and more compelling ad formats in front of our advertiser's customers on Twitter."
Twitter beat monthly active user projections, hitting 336 million at a growth rate of 6 percent year over year. It reported 69 million monthly active users in the U.S., slightly short of the estimated 70 million. It reaches 267 million monthly active users internationally, ahead of the 266 million projections. It also grew daily active users 10 percent year over year, but it does not break out the specific number of users.
The company credited making it easier for people to follow topics, interests and events on Twitter as part of the reason why it was able to attract more users.
"We made meaningful progress in our ongoing safety and information quality work in Q1, and we are continuing to invest in improving the quality of content and the overall health of the
conversation on Twitter," the company said in a letter to shareholders.
An hour before Wednesday's opening bell, the stock was up 2.9 percent in the premarket.