Twitter earnings impress, users up by 4 million

Twitter has announced its Q3 2017 earnings and the stock is up in pre-market trading as a result of increased sales and user growth, reports CNBC. The highlights:

  • $590 million in revenue vs. the Street’s estimate of $586.7 million
  • an EPS of 10 cents per share vs. the Street’s estimate of 6 cents
  • 330 million Monthly active users (MAUs) vs. the Street’s estimate of 330.4 million. That’s an increase of 4 million monthly active users
  • though ad revenue declined 8% YOY, data licensing and other revenue increased 22% YOY

That last point requires some explanation. Twitter revealed it has been miscalculating its monthly active users (MAUs) all the way back to the fourth quarter of 2014. The miscalculations came because the company was including users of a third-party ad service in its MAUs. That miscalculation meant the company was overestimating its users by 1 to 2 million per quarter since. Twitter has now corrected the problem and, even adjusted for the corrections, the microblogging service added 4 million true MAUs last quarter. In a statement, Twitter CEO Jack Dorsey said:

“This quarter we made progress in three key areas of our business: we grew our audience and engagement, made progress on a return to revenue growth, and achieved record profitability. We’re proud that the improvements we’re making to the product continue to bring people back to Twitter on a daily basis. It’s our job to help people stay informed about what’s happening in the world and what people are talking about, and we’re focused on making our service faster, easier to use, and more relevant to more people every day.”