Twitter’s stock has skyrocketed in the last year, doubling to a share price of about $30. That’s a bigger surge than we’ve seen from tech stalwarts like Google and Amazon.
Of course, context is everything: Those companies boast stock prices upwards of $1,000, and Twitter’s stock growth is largely the byproduct of its first profitable quarter and increasing engagement. So here’s what we’ll be watching for when Twitter reports its Q1 earnings tomorrow morning.
- Twitter’s user growth—especially in the U.S.—seems to have more or less plateaued. (That said, analysts anticipate that Twitter gained 4 million tweeters in the last quarter, for a total of 334 million monthly active users.) Where Twitter is still gaining ground is in daily active users, which increased by 12% last quarter. Twitter hasn’t revealed what that translates to in absolute numbers, but its recurring daily user growth indicates Twitter’s existing audience could be monetized further.
- Can Twitter maintain profitability? Last quarter, the company recorded a net profit of $91 million and $732 million in revenue. Twitter’s ongoing investment in video helped the company score its first profitable quarter, and analysts expect Twitter will report yet another profitable quarter tomorrow. Estimates peg revenue at nearly $607 million.
- Twitter’s user growth has been stymied, in part, by the company finally cracking down on abusive behavior. (In its recent transparency report, for example, Twitter revealed it had axed 1.2 million terrorist-related accounts over the last five years.) The company still has work to do on that front, and Jack Dorsey has admitted Twitter needs help, which prompted him to crowdsource proposals for how to measure the “health” of conversation on the platform. Twitter has received more than 230 such proposals, so we expect to hear more on how that will shape its approach to abuse and harassment.