Barring any last-minute changes, Twitter will unveil its fourth-quarter earnings on Thursday morning, but will this earnings report be as lackluster as the last one? As always, the answer to that question hinges on whether the company has managed to lure in new users over the past few months.
Election chatter—along with sustained civic engagement following the election—and President Trump’s warm embrace of the platform may have given it a boost in the fourth quarter. What remains to be seen is whether those new users will keep coming back for the long haul. Analysts at MoffettNathanson noted recently that even if there is a “Trump bump,” Twitter simply hasn’t proven itself as a social network for the masses. Despite live-streaming major events like the Olympics, Thursday Night Football games, and the Democratic and Republican National Conventions, Twitter barely moved the needle on user numbers during the third quarter last year.
Other analysts are a bit more optimistic that Q4 earnings may exceed expectations as a result of election-related engagement and potential success from live-streaming the presidential debates and NFL games.
Twitter could use the good news. Its Q3 2016 earnings report, which confirmed rumors of layoffs and all but quashed any acquisition talk, revealed that it had 317 million monthly active users—just a 3% increase year-over-year. That came as little surprise given Twitter’s track record for user growth: The company only attracted an additional 15 million users during the 18-month period from Q1 2015 to Q3 2016.
One thing Twitter has steadily worked on recently, amid continued criticism, is curbing harassment and empowering users to report hateful content—an improvement that CEO Jack Dorsey will surely point to during the earnings call. (In fact, Twitter just announced yesterday that a new algorithm will help bury abusive tweets and that it would make it more difficult for harassers to create new accounts.) This isn’t just important to retain and attract users; Twitter’s infamous reputation as a hotbed for abuse and harassment was reportedly part of the reason Disney declined to submit an acquisition offer last fall.
Dorsey will likely also give an indication of how Twitter’s live-streaming efforts are faring. Periscope CEO Kayvon Beykpour is reportedly now in charge of all live video initiatives, an area Twitter invested heavily in last year with its NFL partnership.
We’ll be keeping our eye out for anything interesting in tomorrow’s report. Stay tuned.