Twitter Inc. (NYSE:TWTR)

Gross Profit Margin

The gross profit margin displayed a relatively stable trend over the five-year period, beginning at 64.75% in 2017 and peaking at 68.28% in 2018. It then experienced a slight decline to 63.23% in 2020 before a small recovery to 64.6% in 2021. Overall, the margin fluctuated within a narrow range, indicating consistent efficiency in managing production or service delivery costs relative to revenue.

Operating Profit Margin

The operating profit margin demonstrated significant volatility throughout the period. It started low at 1.59% in 2017, increased sharply to 14.9% in 2018, and then decreased to 10.59% in 2019. Subsequently, it dropped dramatically to 0.72% in 2020, followed by a negative margin of -9.7% in 2021. This trend suggests deteriorating operational efficiency and increasing expenses or reduced operating income in the latter years.

Net Profit Margin

The net profit margin showed high variability and instability. The margin was negative at -4.42% in 2017, then surged to strong positive figures of 39.63% and 42.37% in 2018 and 2019 respectively. However, this was followed by a significant reversal, with a steep decline to -30.56% in 2020 and a slight improvement to still negative -4.36% in 2021. The fluctuations likely reflect extraordinary items or substantial changes in income tax, interest, or other non-operating factors impacting net profitability.

Return on Equity (ROE)

Return on equity trends paralleled the net profit margin, starting negative at -2.14% in 2017 and improving considerably to 17.71% in 2018 and 16.84% in 2019. Subsequently, it declined sharply to -14.25% in 2020 and improved slightly to -3.03% in 2021. This suggests that shareholder value creation was volatile and declined substantially in recent years, possibly due to losses or equity dilution.

Return on Assets (ROA)

Return on assets followed a similar pattern, starting at -1.46% in 2017, rising to 11.86% in 2018 and remaining stable at 11.54% in 2019. It then reversed to negative returns of -8.49% in 2020 and -1.57% in 2021. This indicates fluctuations in overall asset profitability and effectiveness in generating earnings from total assets, with a marked decline starting in 2020.

Revenue

Revenue shows a consistent upward trajectory over the five-year period, increasing from approximately $2.44 billion in 2017 to about $5.08 billion in 2021. This represents a significant growth exceeding 100%, indicating robust expansion in the company's sales or services delivered.

Gross Profit

Gross profit similarly follows an increasing trend, rising from roughly $1.58 billion in 2017 to nearly $3.28 billion in 2021. This growth in gross profit aligns with the revenue increase, reflecting improved absolute profitability in core operations.

Gross Profit Margin

The gross profit margin fluctuates moderately throughout the period. Starting at 64.75% in 2017, it increases to a peak of 68.28% in 2018, before gradually decreasing to 63.23% in 2020, then rising slightly to 64.6% in 2021. Despite this volatility, the margin remains relatively stable within the mid-60% range, indicating consistent efficiency in managing cost of goods sold relative to revenue.

Overall Analysis

The combination of a strong increase in revenue and gross profit demonstrates effective growth in scale and operational profitability. The gross profit margin's relative stability suggests that cost control measures have been maintained effectively, with no significant deterioration in production or acquisition costs. The peak in margin in 2018 followed by a dip in 2020 may indicate some variance in cost structure or product mix, but the margin recovers somewhat by 2021.

Revenue Trends

Revenue exhibited a consistent upward trajectory over the five-year period. Beginning at approximately $2.44 billion in 2017, revenue increased each year, reaching around $5.08 billion by the end of 2021. This represents more than a doubling in revenue, indicating significant growth in sales or service income.

Income from Operations

Income from operations experienced notable fluctuations. There was a considerable increase from roughly $38.7 million in 2017 to $453.3 million in 2018, followed by a slight decline to $366.4 million in 2019. A sharp decrease occurred in 2020, with operational income falling to approximately $26.7 million, and further deteriorating into a substantial operating loss of about $492.7 million in 2021. This trend suggests increasing challenges in managing operating expenses or other operational inefficiencies, particularly in the latter years.

Operating Profit Margin

The operating profit margin mirrored the volatility seen in operational income. Starting at a modest 1.59% in 2017, it peaked at 14.9% in 2018, and then declined steadily over the following years. By 2020, the margin dropped to 0.72%, a very thin margin indicating near breakeven operations. In 2021, the margin turned negative at -9.7%, reflecting operating losses relative to revenue, and suggesting deteriorating profitability and possibly rising costs or other unfavorable operating conditions.

Revenue Trends

Revenue exhibited a consistent upward trajectory over the five-year period, rising from approximately 2.44 billion US dollars in 2017 to about 5.08 billion US dollars in 2021. This represents more than a twofold increase, indicating substantial growth in the company's sales or service activities during this timeframe.

Net Income (Loss) Trends

The net income pattern showed significant volatility. In 2017, the company experienced a net loss of approximately 108 million US dollars. This turned into positive earnings in 2018 and 2019, with net income reaching about 1.2 billion and 1.47 billion US dollars respectively, suggesting a strong profitability phase. However, this was followed by a reversal into losses in 2020 and 2021, with net losses of roughly 1.14 billion and 221 million US dollars respectively, illustrating financial challenges or increased expenses in the later years.

Net Profit Margin Analysis

The net profit margin further confirms the variability observed in net income. The margin was negative at -4.42% in 2017, sharply increased to high positive margins of approximately 40% and 42% in 2018 and 2019, indicating very high profitability relative to revenue during these years. This was followed by a drastic decline to -30.56% in 2020 and a lesser negative margin of -4.36% in 2021, showing that the company returned to unprofitable operations with a considerable decrease in profitability in 2020 and partial improvement in 2021.

Overall Performance Insights

The company experienced a growth phase in revenue accompanied by strong profitability in 2018 and 2019. However, despite increasing revenue continuously through 2021, profitability was not sustained, with net losses reappearing in 2020 and 2021. This suggests that rising costs, operational challenges, or other financial pressures negatively impacted the company's ability to convert revenue into profit in the most recent years analyzed.

The analysis of the annual financial data reveals significant volatility in the company's profitability and return on equity (ROE) over the reported periods. Net income exhibited substantial fluctuations, transitioning from a loss of approximately 108 million US dollars in 2017 to a strong profit exceeding 1.2 billion US dollars in 2018, further increasing to approximately 1.47 billion US dollars in 2019. However, this upward trend reversed sharply with losses reported again in 2020 and 2021, amounting to approximately 1.14 billion and 221 million US dollars, respectively.

Net Income (Loss)

The net income figures indicate a peak in profitability during 2018 and 2019, followed by a return to losses in the two subsequent years. This reversal suggests challenges that affected the company’s ability to sustain profitability after 2019.

Stockholders’ Equity

Stockholders' equity demonstrated consistent growth from 2017 through 2019, rising from approximately 5.05 billion to 8.70 billion US dollars. This growth trend plateaued and slightly reversed in 2020 and 2021, with equity decreasing to roughly 7.97 billion and 7.31 billion US dollars, respectively. The decline in equity in the latest two years corresponds with the reported net losses during the same periods.

Return on Equity (ROE)

ROE closely mirrored the net income trends, showing negative returns in 2017 (-2.14%) and a positive surge to 17.71% in 2018 and 16.84% in 2019. Following the profitability peak, ROE turned negative again in 2020 (-14.25%) and improved slightly in 2021 but remained negative at -3.03%. This indicates that the company struggled to generate positive returns on shareholders' equity in the most recent years.

Overall, the data highlights a period of strong financial performance in 2018 and 2019, followed by a notable downturn beginning in 2020. The negative net income and ROE in the latter years have exerted downward pressure on stockholders' equity, reflecting the financial challenges faced during that period. These trends suggest the need for strategic measures to restore profitability and improve returns for shareholders moving forward.

Net Income (Loss) Trends

The net income exhibits significant volatility over the observed five-year period. Starting with a loss of approximately 108 million USD in 2017, there is a notable turnaround in 2018 and 2019, with profits reaching over 1.2 billion USD and 1.46 billion USD respectively. However, this positive trend reverses sharply in 2020 where the company reports a substantial loss of approximately 1.14 billion USD, followed by a less severe but still negative result of 221 million USD in 2021.

Total Assets Growth

Total assets show a consistent upward trajectory throughout the period. From around 7.41 billion USD in 2017, total assets increased steadily each year, ending at approximately 14.06 billion USD in 2021. This indicates ongoing asset accumulation or investment, nearly doubling in size over five years.

Return on Assets (ROA) Behavior

The return on assets correlates closely with net income trends, displaying strong positive returns in 2018 and 2019 at approximately 11.86% and 11.54% respectively. These years represent efficient use of the growing asset base to generate profits. However, ROA turns negative in 2020 and 2021, mirroring the net income losses. The decline to -8.49% in 2020 and a lesser negative -1.57% in 2021 suggests reduced asset profitability and operational challenges during these years.

Overall Insights

The financial data reflects a period of growth in asset size coupled with volatile profitability. While the company achieved strong income and efficiency gains mid-period, the recent years indicate a downturn in financial performance despite continuing asset expansion. This may point to operational or market difficulties affecting earnings capacity, highlighting a need for strategic focus on restoring profitability relative to asset utilization.