The growing trends of Facebook and Twitter share prices run opposite directions in 2015. The increase of Facebook share indicated its excellent executed performance. The decrease of Twitter share was related to lower user growth. It derived some uncertain reasons.
Even though the share price of Facebook is higher than Twitter’s in 2015, it was beaten by Twitter revenue growth. The mobile ads revenue growth stimulated an increase of Twitter’s total revenue. Its Q3 revenue growth increased by 58%(YOY), while Facebook’s Q3 revenue growth increased by 41%(YOY).
It is apparantly to Twitter that it received quick revenue growth. Each quarter of Twitter’s revenue growth is beyond the analyst’s prediction. Take Q3 for example, Twitter’s EPS was $0.1 in accordance with non-GAAP calculation, increased by 10 times(YOY).
Why investors feel disappointed with Twitter performance? Twitter sequential Monthly Active User Growth was only 1% in Q3. The investors wish to know whether its revenue growth decreases if Twitter fails to promote high-level user growth.
On the contrary, Facebook user growth went beyond analyst’s prediction. Facebook sequential monthly active user growth was 4% during Q2 and Q3. Its ability of attracting new users is impressed. Its montly active users increased from 1.49 billion to 1.55 billion.
In the meanwhile, Twitter monthly active users increased from 316 million to 320 million. The investors feel confident with Facebook’s future.
Jack Dorsey admitted the difficulties for user growth. The management group is working to solve such problem. If he succeeds, the investors might obtain more confidence for Twitter’s development.