Twitter Posts Better Profits Result for the Third Quarter
Social networking giant Twitter Inc. reported on Thursday better-than-expected financial results for the third quarter, raising the company’s hope of having a profitable outcome in the fourth quarter.
Twitter’s chief executive Jack Dorsey said that they were able to see improvement in three key areas of their business, including audience and engagement, revenue, as well as profit.
The company believes that if they managed to beat its internal targets, their fourth quarter might just become profitable.
The California-based social networking platform presented non-GAAP net income of $78 million, adding 28 percent from $61 million in the previous year. EPS grew from $0.09 to $0.10 a share.
Adjusted EBITDA was $207 million, which was 14 percent higher from $181 million in the same period last year.
Twitter’s Revenue Declines, but Still Beat Forecasts
Revenue dropped 4 percent year-over-year from $616 million a year earlier to $590 million as a result of its decision to trim down its TellApart advertising product, though it still surpassed analysts’ expectation of $587 million.
The company’s advertising revenue also declined by 8 percent to $503 million, while revenue in the US fell 11 percent to $332 million.
Data licensing and other revenue were up by 22 percent to $87 million, while international revenue rose 6 percent to $258 million.
The company’s net loss shrank as much as 79 percent to $21 million, representing a big improvement from last year’s net loss of $103 million.
Twitter Mistakenly Include MAUs of Third-Party Apps
Twitter has also announced that it added 4 million monthly users in the quarter, beating analysts’ estimate of just over one million and pulling its total user base up by 4 percent from 326 million to 330 million. It’s users in the US also grew from 68 million to 69 million.
However, the social network group stated that since the fourth quarter of 2014, they mistakenly identified users of certain third-party apps as their monthly active users (MAUs), which should not have been considered as MAUs.
Twitter has adjusted its estimates downward, but the difference only totaled to less than 1 percent. Its daily active users were not affected and it grew 14 percent on year to year basis.
Shares of Twitter jumped as much as 15 percent to $19.64, after it presented better earnings result and user growth on Thursday.
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