Twitter shares plummeted by around 20 percent on Tuesday after poor first quarter results were leaked ahead of schedule.
Revenue was shy of market estimates and the social networking giant cut its sales forecast.
Twitter cut its full-year guidance down from a range of $2.3 billion to $2.35 billion to between $2.17 billion and $2.27 billion.
Twitter cut its sales forecast for the second quarter down to $470 million to $485 million, well below the average Wall Street forecast of $538 million.
Revenue increased in the first quarter by 74 percent to $436 million, up from $250 million a year earlier. However, analysts had expected revenue of $456.2 million.
The company posted adjusted earnings of 7 cents, ahead of what analysts had expected of 4 cents.
Results leaked an hour before official release
First quarter results were leaked about one hour before the official release by a data-mining firm. Twitter then issued the release early.
Selerity posted four tweets after 3 p.m. ET Tuesday with Twitter’s first-quarter earnings, revenue and user figures.
Average monthly active users (MAUs) for the quarter were 302 million, which was in line with expectations and an 18 percent gain year-over-year.
However, mobile MAUs missed Wall Street estimates.
Twitter shares dropped by more than 25%. Shares closed at $42.27, down 18%, and continued to fall in aftermarket trading.
According to Reuters, Todd Schoenberger, Managing partner of Landcolt Capital LP in New York, said:
“The fact that the results were leaked isn’t good, because it raises a lot of security and privacy questions. If it can’t keep its results safe, can it protect its users? This just shows that the company is poorly managed.
“I’m confused about how Twitter can continue making money. Not only was the outlook bad, but it looks like the user base is dropping, and Twitter is nothing without user growth. I’m very bearish on the stock.”