Twitter Inc. (NYSE:TWTR)

The financial data over the five-year period reveal several significant trends in net income, both reported and adjusted, for the company.

Reported Net Income (Loss)

The reported net income shows a notable turnaround from a substantial loss of approximately 108 million US dollars in 2017 to a significant profit exceeding 1.2 billion US dollars in 2018. This upward trend continued into 2019, reaching a high of over 1.46 billion US dollars. However, the financial performance reversed sharply in 2020, resulting in a large loss of around 1.14 billion US dollars, followed by a smaller loss of approximately 221 million US dollars in 2021. This indicates considerable volatility, with profitability achieved only during the middle years, surrounded by losses at the start and end of the period.

Adjusted Net Income (Loss)

The adjusted net income follows a pattern very similar to the reported figures, demonstrating the impact of adjustments was not materially altering the overall profit or loss trends. The adjusted figures also show a loss in 2017 close to 109 million US dollars, a recovery to profits slightly above 1.2 billion US dollars in 2018, and an increase to approximately 1.48 billion US dollars in 2019. Subsequently, adjusted net income declined significantly to a loss of about 1.12 billion US dollars in 2020 and a loss of around 247 million US dollars in 2021. This parallel movement suggests that non-operating or extraordinary items had a relatively minor effect on the overall net income trend throughout the years.

Overall, the data reflect a period of strong profitability in the middle of the timeframe examined, bookended by losses which highlight financial instability or significant changes in operational performance or market conditions. The alignment between reported and adjusted net income figures suggests the underlying business dynamics are the primary driver of the observed results, rather than accounting adjustments or one-time items.

The financial performance over the analyzed periods reflects significant volatility in profitability and returns metrics. Net profit margins, both reported and adjusted, experienced a notable improvement from negative values in 2017 to strong positive margins in 2018 and 2019. Specifically, the reported net profit margin increased from -4.42% in 2017 to 39.63% in 2018 and further to 42.37% in 2019. Adjusted margins followed a similar trend, reaching 42.77% in 2019. These elevated margins indicate a period of substantial profitability during the middle years.

However, a sharp reversal occurred in 2020, with reported and adjusted net profit margins falling drastically to negative figures, -30.56% and -30.25%, respectively. This sudden decline continued into 2021, with margins remaining negative, albeit less severely than in 2020, at approximately -4.36% reported and -4.87% adjusted. This pattern points to significant challenges impacting profitability in the latter years.

Return on equity (ROE) mirrored the trends observed in net profit margins. After a negative ROE of -2.14% in 2017, values surged to a peak above 17% in 2018 and 2019. Both reported and adjusted figures were closely aligned during these years, indicating consistent adjustments did not materially alter the underlying trend. The ROE subsequently deteriorated to negative territory in 2020 (-14.25% reported, -14.11% adjusted) and remained negative in 2021, though improved to around -3.0% reported and -3.38% adjusted. This reflects diminished returns to shareholders following the 2019 peak.

Return on assets (ROA) also followed a consistent pattern with net profit margins and ROE but at lower absolute levels. Starting with negative returns in 2017 (-1.46% reported, -1.48% adjusted), ROA improved significantly to approximately 11.5% in 2018 and 2019. Subsequently, it declined sharply to negative values in 2020 (-8.49% reported, -8.40% adjusted) and modestly improved in 2021 but stayed in negative territory (-1.57% reported, -1.76% adjusted).

The close alignment between reported and adjusted figures across all metrics suggests limited impact from investment adjustments on the overall profitability and returns analysis. The major characteristic of the data is the substantial improvement in 2018 and 2019, followed by a pronounced downturn starting in 2020 carrying through to 2021. These patterns may indicate external or operational challenges impacting financial performance during the latter periods.

The financial data reveals significant fluctuations in both reported and adjusted net income over the five-year period. Initially, there was a considerable loss in 2017, with reported net income at -108,063 thousand US dollars and adjusted net income similarly negative at -109,388 thousand US dollars. However, in 2018 and 2019, a strong recovery and growth are evident, as net income shifted dramatically to positive figures, peaking in 2019 with reported net income reaching approximately 1,465,659 thousand US dollars and adjusted net income slightly higher at 1,479,444 thousand US dollars.

This positive trend corresponds with high net profit margins during the same years. Both reported and adjusted net profit margins soared to nearly 40% in 2018 and slightly exceeded 42% in 2019, indicating substantial profitability relative to revenue during this period.

The trend reverses sharply in 2020, where both reported and adjusted net incomes returned to negative territory, with losses exceeding 1,130,000 thousand US dollars reported, accompanied by similarly large losses in the adjusted figures. Correspondingly, net profit margins also declined markedly, registering negative values of around -30%, suggesting significant challenges or costs impacting profitability during that year.

In 2021, the losses persisted but were considerably reduced compared to 2020. Reported net income and adjusted net income losses decreased to -221,409 thousand and -247,326 thousand US dollars, respectively. Net profit margins demonstrated a similar recovery pattern, improving from approximately -30% in 2020 to around -4% in 2021, but still reflecting an unprofitable state.

Overall, the data indicates a period of robust profitability in 2018 and 2019, flanked by notable losses in 2017, a severe downturn in 2020, and partial recovery in 2021. The close alignment between reported and adjusted figures suggests consistency in financial adjustments and reporting practices. The sharp declines in 2020 and subsequent partial recovery in 2021 may warrant further investigation into underlying causes such as market conditions, operational changes, or extraordinary events affecting performance in those years.

Reported Net Income (Loss)

Significant loss in 2017, strong profitability in 2018 and 2019, sharp loss in 2020, partial recovery in 2021.

Adjusted Net Income (Loss)

Trend closely mirrors reported net income with minor differences, confirming consistent adjustments.

Reported Net Profit Margin

Negative margin in 2017, very high profitability in 2018 and 2019 over 39%, severe decline to -30% in 2020, improved but negative in 2021.

Adjusted Net Profit Margin

Follows pattern similar to reported margin, slightly higher peak in 2019, slightly more negative in 2021, consistent with income loss trends.

Over the examined period, the reported net income exhibited significant fluctuations, beginning with a substantial loss in 2017, followed by marked profitability in 2018 and 2019, then reverting to losses in 2020 and 2021. Adjusted net income mirrored this trend closely, showing a minor variation in values but reflecting the same overall pattern of recovery and subsequent decline.

Specifically, the transition from a negative net income in 2017 to strong positive earnings in 2018 and 2019 indicates a period of operational improvement or favorable market conditions. However, the return to negative net income in the two most recent years suggests challenges impacting profitability, possibly related to external factors or shifts in business operations.

The Return on Equity (ROE) metrics, both reported and adjusted, align with the income trends. The ROE turned from negative in 2017 to positive and relatively high levels in the subsequent two years, before declining sharply into negative territory by 2020 and moderating losses in 2021. This pattern indicates that shareholder returns improved significantly during the middle years but deteriorated thereafter, reflecting the underlying net income performance.

Net Income Trends

Initially negative in 2017, peaked positively in 2018 and 2019, then reverted to losses in 2020 and 2021.

Adjusted Net Income

Consistently tracks the reported figures closely, affirming reliability of adjustments made for investment analysis.

Reported ROE

Moved from a modest negative return in 2017 to robust positive returns in 2018 and 2019 before experiencing a significant downturn in subsequent years.

Adjusted ROE

Follows the same trajectory as reported ROE with slight variances, reinforcing the net income observations.

The data illustrate a cyclical profitability pattern with a peak performance phase followed by financial stress. This could warrant examination of contributing factors during the downtrend period for strategic decision-making or operational adjustments.

The financial performance over the analyzed periods displays notable fluctuations in both reported and adjusted net income, as well as in the corresponding return on assets (ROA) metrics.

Net Income (Loss)

The reported net income transitioned dramatically from a significant loss of approximately $108 million in 2017 to a substantial profit of around $1.2 billion in 2018. This upward trajectory continued in 2019 with an increase to roughly $1.47 billion. However, this positive momentum reversed sharply in 2020, with the company incurring a loss of approximately $1.14 billion, followed by a smaller loss of around $221 million in 2021.

The adjusted net income figures closely mirror this pattern, indicating consistent adjustments that do not materially alter the overall trends. Adjusted figures moved from a similar loss in 2017 to gains in 2018 and 2019, then back to losses in the subsequent years, slightly differing in magnitude but maintaining the same directional changes.

Return on Assets (ROA)

Reported ROA exhibits a corresponding trend, starting negative at -1.46% in 2017, improving significantly to over 11% in both 2018 and 2019, then sharply falling again to negative values of -8.49% in 2020 and -1.57% in 2021. This pattern suggests a period of strong asset profitability followed by diminished efficiency and asset utilization in the latter years.

The adjusted ROA aligns closely with the reported ROA, reinforcing the consistency of these observations after accounting for adjustments. Adjusted ROA figures are marginally different but maintain the same overall trend of strong performance in 2018-2019 and a decline thereafter.

Overall, the data indicates a cycle of pronounced improvement in financial outcomes through 2018 and 2019, followed by significant deterioration in 2020 and 2021. The company’s asset utilization efficiency, as reflected in ROA, mirrored these fluctuations, highlighting the impact of the losses in the recent years. The close alignment between reported and adjusted figures suggests that the adjustments do not considerably affect the interpretation of financial performance trends.