Updated from 9:15 a.m. to include thoughts from Merill Lynch analyst.
NEW YORK (TheStreet) -- Twitter (TWTR) is expected to report its first earnings report Wednesday after the close of trading. At this stage, it's a wild card on what to expect, and it's time to place your bets -- in 140 characters or less.
Twitter shares have had a strong run since going public, gaining nearly 50% since the initial public offering in November. The company has been busy signing and announcing deals since going public, including ones with the NFL, CBS (CBS) and others to try to boost engagement and monthly active users (MAUs).
TWTR data by YCharts
When Twitter went public, it only had 231.7 million users, a lower number than many thought, especially compared to Facebook (FB), which has well more than 1 billion users. CEO Dick Costolo, who uses the handle @dickc, has been largely pretty quiet since the IPO, but is working hard to boost the company's MAU and to show Wall Street that the San Francisco-based service is more than just a niche product.
Twitter is still in investment mode, and isn't expected to earn a profit any time soon, which might otherwise derail the company's growth plans. Analysts surveyed by Thomson Reuters are looking for Twitter to lose 2 cents a share in the fourth quarter on $217.8 million in sales.
Analysts will be looking for clarity on how well the company's three main products -- promoted tweets, promoted accounts, and trends -- are doing. We've heard several advertisers (including TheStreet) say there have been mixed results with the
Here's what several analysts on Wall Street had to say going into the report:
Wedbush Securities analyst Shyam Patil (Neutral, $58 PT)
"Our checks pointed to a very strong 4Q with rising average spend per campaign. Feedback suggests that Twitter is still an experimental part of budgets and generally gets bundled into a large package for social buys vs. Facebook, which is starting to get its own line item. There are some specific advertisers, however, who have a dedicated Twitter line item; in one case, we heard of a global marketer whose budget for Twitter is larger than that of Facebook. Our checks indicate the strong momentum has continued into 1Q and
commentary suggests that Twitter budgets could at least double in 2014, as the advertising platform matures, new products (such as tailored audiences, Amplify) gain traction and analytics/measurability improve."
Cantor Fitzgerald analyst Youssef Squali (Sell, $32 PT)
"We're modeling for ad growth of 115.3% Y/Y, to $214.1M in 4Q:13, representing only slight deceleration from the +123.5% Y/Y growth reported in 3Q:13. Considering FB's
4Q:13 results, which showed accelerating ad revenue growth (76% Y/Y vs. 66% in 3Q:13), we may see a similar pattern out of TWTR. As social media spend continues to take share of integrated ad budgets and as more marketers gain comfort with new platforms, we expect this strong growth to continue in 2014 (+102.5%) and beyond (51% 5-year CAGR, by our estimate)."