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Twitter comeback continues with stronger user growth

April 23, 2019
Twitter planning new subscription platform?

Twitter has posted positive earnings results on the back of its renewed focus on its data business, appealing to marketers.

The company, which has been spending big on improving the user experience, beat market expectations with an 18% jump in revenue to $787m in the first three months of the year compared to the same period in 2018.

It said advertising sales, also 18% higher than a year ago, accounted for the bulk of the increase – with video ads making a greater contribution.

Twitter, which only publicly started revealing the figures at the end of last year, said its ‘monetizable’ daily active users – which measures users exposed to advertising on a daily basis.- rose to 134 million in the three months. That represented a 12% increase.

The company said it remained profitable, with earnings growing more than 200% to 191m in the period aided by a tax benefit, despite operating expenses hitting $693m.

The firm blamed its crackdown on abusive user behaviour that has seen it hire more staff.

Chief executive Jack Dorsey said: “We are reducing the burden on victims and, where possible, taking action before abuse is reported.

“For example, we are now removing 2.5x more Tweets that share personal information and 38% of abusive Tweets that are taken down every week are being proactively detected by machine learning models.

“We’re also continuing our work to make Twitter more conversational via the launch of our public prototype app (twttr), with the end goal of making conversation on Twitter feel faster, more fluid, and more fun.”

Shares were trading almost 8% up ahead of the official New York Stock Exchange open.

Yuval Ben-Itzhak, CEO, Socialbakers, said: “It is encouraging that Twitter has managed to improve its monetisation and grow revenue. In the last quarter, we’ve seen Twitter focus heavily on its data business, which is a smart move that will continue to grab businesses’ attention and help to further grow revenue.

“Twitter’s data is hugely valuable for marketers, who can tap into the data insights in order to better understand their audiences. Therefore, brands are willing to pay extra for this data on top of their ad spend. This data monetisation strategy should continue to serve Twitter well.”

Aaron Goldman, CMO, 4C Insights, added: “The first quarter is always a big one for Twitter given its role as the default second-screen for tentpole events like the Super Bowl and Oscars. The fact that performance was so strong shows that it also benefited from outsized budget allocation in the annual planning cycle. In particular, we’re seeing great success with video on Twitter and our advertisers are adopting these formats as a core part of their cross-channel mix. For Q1 2019, we saw double-digit increases year-over-year on Twitter video ad budgets.”

 

Social advertising, brands, Twitter, video

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