Twitter (TWTR) reported a top- and bottom-line beat late Tuesday and attributed a 119 percent increase in revenue to user and engagement growth, however its shares were pummeled after hours by skittish investors unhappy with the pace of acceleration.
Monthly active users were up 25 percent year-over-year to 255 million as of March 31, slightly below Wall Street's expectations of 256.8 million MAUs.
That seems to have spooked investors, as analysts have long expressed concern about the pace of Twitter's user growth.
Advertising revenue per thousand timeline reviews grew 96 percent to $1.44 -- important as the company readies to roll out another 15 new ad types.
The microblogging site projected revenue in the range of $270 million to $280 million for the second quarter and $1.2 billion to $1.25 billion for fiscal 2014. Analysts on average were calling for second-quarter sales of $272.9 million on full-year revenue of $1.24 billion.
The company reported a GAAP loss of $132 million, or 23 cents a share, compared with a year-earlier loss of $27 million. Excluding $126 million of stock-based compensation, Twitter said it earned $183,000.
It also reported break-even adjusted earnings per share -- the closest it has come to profitability -- which is better than the three-cent loss predicted by analysts in a Thomson Reuters poll.
Revenue for the three-month period was up 119 percent to $250 million from $114 million a year ago, topping the Street's view of $241.5 million.
"We had a very strong first quarter. Revenue growth accelerated on a year-over-year basis, fueled by increased engagement and user growth," Twitter CEO Dick Costolo said in a statement.
The report comes a quarter after the social network said it added a disappointing 9 million users, causing the company's stock in plunge 20 percent.
Since then, Twitter has been busy upgrading the service, which now resembles the Facebook (FB) News Feed, as well as rolling out an aggressive ad expansion. It has also acquired new data analytics firms and made strides toward social television.