Both Twitter and LinkedIn posted Q4 2013 earnings results this week, and both saw sharp declines in their stock price. But what other comparisons can be made from the usage data they made available?
Although the two firms use different methods of calculating active users (Twitter has its own Monthly Active Users metric, whilst LinkedIn relies on its own membership data and Comscore measurement), a comparison can easily be made.
Much has been made of Twitter’s slowing growth, but LinkedIn’s growth has slowed even further (a mere 1.6% increase on Q3 2013, which actually showed a sharp decline).
Again, both companies use different measures of activity. Twitter has its nebulous ‘timeline views’ whereas LinkedIn relies on Comscore’s calculation of page views.
This would account for the marked discrepancy in the absolute numbers seen above, so it is better to look at the growth/decline over the last quarter. Here we see that whilst both platforms have declined, it is actually LinkedIn that has dropped the most:
- Twitter: Timeline views down 6.9% quarter-on-quarter and up 26.5% year-on-year
- LinkedIn: Page views down 8.2% quarter-on-quarter and up 9.8% year-on-year
It’s also worth looking at these absolute activity number relative to the user base.
Again, a direct comparison between the numbers themselves is not helpful, because of the methods each platform uses to track activity. The trend is interesting though:
- Twitter saw a 10.5% decline quarter-on-quarter (3.5% down year-on-year) in timeline views per active user
- LinkedIn saw a 9.6% decline quarter-on-quarter (9.2% down year-on-year) in page views per unique visitor
- Over the full year, timeline views per active user on Twitter actually increased by 11.8% whereas page views per unique visitor for LinkedIn saw a massive 24.9% drop
From the data above, it seems odd that Twitter’s stock price fell by a quarter following its results, whereas LinkedIn’s fell by only (!) 15 per cent. Looking at revenue trends might help.
LinkedIn is the clear winner when it comes to net revenue, out-gunning Twitter by a factor of almost two. But Twitter is beginning to close the gap; its net revenues are up 117% year-on-year compared to LinkedIn’s 47.3% growth compared to the same quarter in 2012.
Revenue per user shows the same story.
In Q4 2013 LinkedIn brought in $2.39 of net revenue per user/visitor compared to Twitter’s $1.01. But yet again, it is Twitter that is seeing the fastest growth in this area, putting on 38.4% quarter-on-quarter (66.5% year-on-year) compared to LinkedIn’s 12% quarter-on-quarter (21.8% year-on-year).
So whose stock would you buy?