Twitter falls short of user estimates as class action weighs on losses
Twitter’s monetisable daily active users fell short, the company reported. In its third quarter results, the social media platform registered 211 daily active users, falling short when compared to analysts’ estimates of 212.6 million.
“Average monetizable daily active users (mDAU) reached 211 million, up 13 per cent year over year in the third quarter, accelerating from 11 per cent year over year growth in the second one, driven by ongoing product improvements and global conversation around current events,” commented Twitter’s chief executive Jack Dorsey.
Despite the decrease, the company revenues totalled to $1.28bn – a 37 per cent year-on-year increase – with its advertising revenue taking most of the cake, going up to $1.14bn.
The San Francisco-based company saw an increase in revenues both in the domestic and foreign market, with the US going up to $742m.
“Our focus is paying off, and we are pleased with our performance in the third quarter, with revenue up 37 per cent year-over-year, reflecting strength across all major products and geographies,” said chief financial officer Ned Segal.
“We continued to drive increased value for our advertisers thanks to revenue product innovation, including progress on our brand and direct response offerings, strong sales execution, and a broad increase in advertiser demand.
“These factors contributed to 41% year-over-year growth in ad revenue in the third quarter.”
Despite the 37 per cent increase in revenues, the company suffered a $743m operating loss, mainly due to its decision to settle a consolidated class action.
City PM reported that the class action – which was filed in 2016 by investor Doris Shenwick – alleged that Twitter executives misled investors about the growing rate of its user base.