Earnings Preview: Twitter And Yelp Report In 24 Hours

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Have you recovered from last week? If not I forgive you — after that earnings deluge I think that we all need a break. However, tomorrow has two key earnings reports that will help set the camber of the current tech financial cycle.

Earnings are flat circle.

In about 24 hours, Twitter and Yelp are on the docket. Both are important. Of course, the firms matter for their place in tech, but each has some recent #drama that makes their current cycles all the more interesting.

Twitter

Twitter is in transition. Its former CEO, Dick Costolo, left in June, leaving the social company with an uncertain leadership structure. Will Jack keep the reins, or is he too caught up in the coming Square IPO? It isn’t clear.

But while all that swirls around the upper echelon of Twitter’s San Francisco office, the street expects a $0.04 per-share profit — using adjusted techniques of course — off revenue of $481.13 million. The market also expects Twitter’s profit to pop 50 percent to $0.06 per share in the following quarter, on top line of $555.57 million.

The gist is that regardless of who occupies the throne, investors are not giving Twitter a chance to either slow down or pause. Expect questions tomorrow from analysts regarding who will run Twitter’s show moving forward. It probably won’t be Jack.

Oh, and for fun, on a GAAP basis, Twitter lost $162 million on revenue of $436 million in its most recent quarter. The company will want to beat on financials, and also on user figures. Here’s its last tally:

Screen Shot 2015-07-27 at 1.14.48 PM

Yelp

Yelp’s quarter involved a number of ups and downs that are worth our time, including a massive drop in its share price following reports that the firm had stopped the process of trying to sell itself. Investors, who had presumed a transaction, and likely at a premium, were let down. And so its shares sank.

The street expects Yelp to earn a penny a share off of revenue of $133.48 million in top line.

Here we have a case of the damned-if you-do, damned-if-you-dont. If Yelp does well and beats expectations, its health could be called a new cry for a suitor — after all, what major tech company couldn’t use a new, profitable subsidiary that also has a host of local data? And if Yelp does poorly, there will be calls for its management to find it a corporate refuge.

Once you have put yourself into play, it’s hard to leave the game. Here’s the company’s year-to-date chart. You can’t help but feel a bit nauseous:

Screen Shot 2015-07-27 at 1.21.56 PM

Hopefully the firm can turn it around. That sort of 52-week swing is choppy for any firm.

It’s been a busy earnings cycle, with Apple taking a beating, Amazon actually making money, and everything in between. For Yelp and Twitter, the show is tomorrow. The TechCrunch crew will be all over the results. Stay tuned.