Twitter Results And Outlook Send Stock Down 12%

After the closing bell, Twitter reported earnings for Q3, coming in at $0.01 and meeting the Wall Street estimate, the first time it hasn’t beat since IPO-ing last year. Revenues came in stronger than expected at $361M, above the Estimize consensus of $360.7M and the Wall Street consensus of $351.8M. One very important metric, average Monthly Active Users (MAUs) came in at 284M for the quarter, a 23% increase from Q3 2013, and topping last quarter’s record of 271M. This is great sign for the company that hopes building a massive user base will help the profits roll in. Twitter projected that Q4 revs will be in the range of $440M - $450M, and full year 2014 revenue will be in the range of $1.365B - $1.375B. Despite posting decent results, the company’s stock price fell 12% in after-hours trading on lower-than-expected user growth and the fact that the revenue guidance for Q4 predicts 80% y-o-y growth, the first non-triple-digit increase in 2 years.

Tomorrow, 49 companies from the S&P 500 will report Q3 earnings, including highly anticipated results from Facebook and Gilead Sciences.

How Are We Doing?

Expectations for S&P 500 earnings growth for the third quarter stand at 10.1%. Revenues are anticipated to come in with 4.2% growth. All 10 sectors are anticipated to post positive YoY growth on both the earnings and revenue front. 

Leaders

Earnings:

Materials (14.0%). Notable industry: Metals & Mining (27.9%).

Health Care (13.1%). Notable industry: Biotechnology (45.5%)

Energy (12.7%). Notable industry: Oil, Gas & Consumable Fuels (11.8%)

Revenues:

Health Care (9.3%). Notable industry: Biotech (39.8%).

Information Technology (7.3%). Notable industry: Internet Software & Services (15.2%)

Laggards

Earnings:

Utilities (0.8%). Notable industry: Multi­-Utilities (-2.5%).

Telecommunication Services (0.9%): All five companies are within Diversified Telecom Services. Only Verizon posted y­o­y growth.

Revenues:

Energy (0.2%). Notable industry: Oil, Gas and Consumable Fuels (­-0.5%).

Materials (2.9%). Notable industry: Paper & Forest Products (­-10.9%).

Beat/Miss/Match

Earnings: 215 companies have reported thus far, 50% have beaten the Estimize consensus, 37% have missed and 13% have met. This is compared to Wall Street estimates, of which 69% of companies have beat on the bottom­-line, 22% have missed and 8% have met.

Revenue: 50% have beaten the Estimize consensus, 50% have missed, and 0% have met. For revenues, 59% of companies have beat the Wall Street estimate, while 41% have missed.