Twitter has seen its profits and revenues rise as advertisers welcome efforts by the social network to cull spam accounts.
The company saw its shares jump by more than 17%, as it revealed advertisers were continuing to increase their spend on its platform, validating its efforts to crack down on spam accounts and bots.
Twitter on Thursday unveiled a third-quarter earnings report that beat analysts’ expectations.
The San Francisco-based social media company also posted overall revenues rising of $758m, which surpassed an analyst forecast of $701m.
The company’s third-quarter ad sales, which comprise the bulk of Twitter’s overall revenues, were $650 million, beating an analyst estimate of $593 million. Twitter said total ad engagements increased 50 percent year-over-year.
The latest revenue line also follows an earlier three consecutive quarters of revenue growth.
But Twitter’s number of total monthly users, at 326 million for the quarter, was down 9 million during the latest three-month period. That also fell short of an analyst forecast of 330 million monthly active users.
The company attributed the drop in monthly user numbers to “a number of factors including: GDPR, decisions we have made to prioritize the health of the platform and not move to paid SMS carrier relationships in certain markets, as well as a product change that reduced automated usage and a technical issue that temporarily reduced the number of notifications sent.”
“We’re achieving meaningful progress in our efforts to make Twitter a healthier and valuable everyday service,” said Jack Dorsey, Twitter’s CEO, in a statement. “We’re doing a better job detecting and removing spammy and suspicious accounts at sign-up.”
Twitter saw its daily active user (DAU) growth, a key metric for any social media company, rise by 9%.
The social messaging app has been trying to improve its user experience and keep people more engaged.
Twitter has forecasted earnings before interest, taxes, depreciation and amortization (EBITDA) for the fourth quarter to be between $320 million and $340 million.
Yuval Ben-Itzhak, CEO of Socialbakers, commented on the results: “It’s exciting to see Twitter reporting a solid Q3 performance, signalling that perhaps the platform really has turned a corner. In the first half of the year, we saw Twitter launch some exciting platform improvements to bring better returns to advertisers, as well as cleaning up their platform to provide a healthier, more transparent experience to both users and marketers.
“Despite a small decline in monthly active users, Twitter has managed to grow its daily active users by 9%, which indicates that users are more regularly active on the platform. It has also consistently grown the revenue it’s seeing from its data business and from ads, especially video ads, which account for more than half of their ad revenue. The addition of more TV and video content, especially the highly lucrative sports broadcasting rights for the NFL and World Cup, has proved to be a winning recipe for the platform.”