Twitter Inc. shares dropped Wednesday despite the microblogging service beating market expectations with solid user growth and revenue in its first quarter.

For the second quarter in a row, and its second quarter ever, Twitter reported a profit, coming in at $90 million. That’s close to the $91 million it earned in the fourth quarter of 2017, a period normally boosted by holiday advertising sales.

Revenue of $665 million was up 21 percent from the same quarter in 2017. Profit before costs such as stock compensation came in at 16 cents, beating analysts’ forecast of 12 cents per share.

Monthly active user numbers, long an issue for the company, grew to 336 million, up 10 percent year-on-year and 6 million from the fourth quarter. According to CNBC, market analysts had been expecting the number to come in at a more modest 334.2 million.

Once again reiterating its faith in live event streaming, Twitter said it signed 30+ new partnerships in the quarter and had livestreamed more than 1,300 events to an estimated 80 percent of its global audience. In other emerging revenue streams, data licensing and other revenue was reported to be $90 million, up 20 percent from a year ago.

With solid numbers beating market expectations, it would be expected that Twitter’s share would rise, and indeed initially following the announcement it was up as much as 14 percent during the day. But once investors got their hands on Twitter’s letter to investors and read through the fine print, that rapidly changed and shares closed down 2.4 percent on the day, to $29.75 a share.

Twitter is predicting that its growth will rapidly slow in the second half of this year. “We face increasingly difficult comparables in the second half of 2018 as we approach the anniversary of the broad-based recovery that began in the second half of 2017,” the letter reads. “As a result, we continue to believe that our sequential growth rates for total revenue for the remainder of 2018 will resemble the sequential growth rates for total revenue in 2016.”

The taming of expectations does not mean that Twitter’s status of profitability is going to change, but it did take the wind out of investors who have more than doubled Twitter’s share price over the last year, outperforming the likes of Facebook Inc. and Alphabet Inc.

Still, some analysts think things are better than they look on the surface. “We think recent headlines on privacy issues and ad targeting as well as yesterday’s negative reaction to guidance create a buying opportunity,” Macquarie Capital (USA) Inc. analyst Ben Schachter wrote in a note to clients. “We believe that the product has the potential to get much better and drive usage and monetization upside.”

With reporting from Robert Hof

Photo of Twitter Chief Executive Jack Dorsey: Brian Solis/Flickr