Shares in Apple and Twitter dropped sharply as the companies’ earnings reports failed to live up to investor expectations.

Shares in Apple (AAPL) dropped around 8% after the closing bell following a disappointing earnings release that showed the first slowing in sales growth in 13 years.

Twitter’s troubles looked far worse by comparison, as the social media firm missed earnings forecasts and cut its guidance for the second quarter. Its stock tumbled nearly 13% in after-hours trading.

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Apple By Numbers

 

Apple posted quarterly revenue of $50.6 billion, with net income of $10.5 billion, which was equivalent to $1.90 per diluted share.

That compares with revenue of $58 billion, income of $13.6 billion, for an EPS of $2.33 in the year-ago quarter.

It was the first year-over-year decline in sales growth since 2003 and largely down to a drop in demand for its flagship iPhone product.

Sales of iPhones actually beat estimates, but at 51.19 million units shipped, the number was down 16% from the same period a year before.

Operating cash flow was $11.6 billion, while the company returned $10 billion to shareholders through its capital return program during the quarter.

Crucially, Apple has upped its dividend by 10% and added $50bn to its capital return program.

Apple’s Services segment did well – delivering its best quarter (excepting for a patent settlement), and was the second largest source of revenues.

Tim Cook, Apple’s CEO, said: “We are very happy with the continued strong growth in revenue from Services, thanks to the incredible strength of the Apple ecosystem and our growing base of over one billion active devices.”

Apple expects its revenues for the next quarter to come in at $41-43bn.

Twitter By Numbers

 

Twitter shares sank 13% in after-hours trade as the company gave little comfort to investors who are beginning to fret about its ability to generate revenues from its users.

Even as the user base expanded faster than expected, markets were left unimpressed. Monthly Active Users were up 3% from a year before

Twitter posted first-quarter earnings of 15 cents per share on $594.5 million in revenue. That was up from 7 cents per share in the previous year, while sales rose 36%.

Analysts had expected EPS of 10 cents on around $608 million in revenues, according to Thomson Reuters estimates.

“Revenue came in at the low end of our guidance range because brand marketers did not increase spend as quickly as expected in the first quarter,” the company said. “We see a clear opportunity to increase our share of brand budgets over time.”

On the positive side, Twitter has seen some improvement in how people are using the platform thanks to some new services.

“We also saw deepening engagement (likes, replies and Retweets) driven by a few important product launches, including the enhancements to the timeline and the Twitter-Periscope integration,” the company said in its shareholder letter.

It’s been a rollercoaster of late for Twitter’s stock price, which fell to an all-time low in February.

That came after its fourth quarter report in January revealed a decline in users – virtually unheard of for a major social media company. Investors were soothed by news that Twitter has done a deal with NFL to stream live matches, but the questions over how it can further monetize the platform remain.