In the last five years, shares of Twitter (TWTR) are down 57%. Time is running out for a turnaround.
Last week, shares of Twitter fell as reports circulated in the media that the Board of Directors was meeting to discuss cost cuts, asset sales and layoffs. While Twitter's board may also put the company up for sale, it's not entirely clear who would be the buyer. With a $13 billion market cap, it would probably cost at least $15 billion to acquire Twitter.
Revenue growth has slowed for eight quarters in a row. At the end of July, the company reported a second-quarter miss and cut third-quarter guidance. Second-quarter fiscal 2016 revenue was $602 million, up 19.9%, but about $5 million below expectations. Revenue fell 8% sequentially, which was better than the 16% sequential decline posted in the first quarter, but disappointing nonetheless. Ad revenue was $535 million, up 18%, but below estimates of $540 million. Mobile advertising was 89% of total advertising revenue.
Data licensing totaled $67 million, up 35%. U.S. revenue was up 12% to $361 million. International revenue increased 33% to $241 million.
But earnings before interest, taxes, depreciation and amortization of $175 million was above Street expectations of $154 million. The better-than-expected EBITDA margin came from lower expenses and a drop in R&D spending.
Monthly average user growth was up just 3% to 313 million -- pretty underwhelming when you consider that Action Alerts PLUS holding Facebook (FB) , for example, reported user growth of 15%. Average MAUs were 66 million, up just 1%, and compared to 65 million in the first quarter.
