New Apptopia Data Paints A Different Picture About Twitter Than Management Commentary

Axiom hosted an investor call with Eliran (Eli) Sapir, co-founder of app market intelligence tool Apptopia, on Wednesday.

According to Sapir, even though global downloads of the Twitter Inc TWTR app remained high during the first quarter of the year, user growth or MAUs fell 1 percent quarter-over-quarter.

He also noted that the social media platform is still experiencing high churn.

It should be noted that, while Sapit paints a bearish scene, Twitter’s management suggested a different situation. According to the company’s management team, January MAU levels returned to those seen in the third quarter of 2015; this implies a sequential increase in the number of users in relation to the fourth quarter of 2015.

This means that, if Apptopia’s data is correct – and taking into account the management’s comments, “user levels would have to have declined in February and March, which would be surprising to us given that there were several events in the quarter (Superbowl, Oscars, Grammys, NCAA tournament) that in theory should have driven up usage,” Axiom’s Victor Anthony noted in a report issued Thursday.

Apptopia assures that the correlation between their data and actual reported figures is pretty high. However, Axiom said this was the first call they hosted with the company, adding that Apptopia's thesis would only play out if user levels fell in February and March, a phenomenon Anthony said would be "surprising."

The firm reiterated a Buy rating and $24 price target on shares of Twitter.

The experts also maintained their 308 million ex-SMS estimate for the first quarter of 2016, up 3 million quarter-over-quarter, as they continue to look for data that either supports or refutes Apptopia’s numbers.

Disclosure: Javier Hasse holds no positions in any of the securities mentioned above.