User growth brightens outlook for Twitter despite losses
Washington (AFP) – Twitter said Wednesday user growth picked up in the past quarter, offering an upbeat outlook despite a decline in revenue and another loss for the social network.
The first quarter results came in better than most forecasts, delivering an early pre-market lift for shares in Twitter, which has struggled to keep pace in the fast-moving world of social media.
The closely watched metric of monthly active users grew nine percent from the same period a year ago to 328 million. Twitter said daily active usage rose 14 percent without offering a specific figure.
The net loss narrowed to $62 million from $80 million a year earlier for Twitter, which has never reported a profit.
Revenues meanwhile fell eight percent to $548 million — which would normally be troubling for a social media group, but the figure was not as bad as feared.
“We’re delivering on our goal to build a service that people love to use, every day, and we’re encouraged by the audience growth momentum we saw in the first quarter,” chief executive Jack Dorsey said in a statement.
“While we continue to face revenue headwinds, we believe that executing on our plan and growing our audience should result in positive revenue growth over the long term.”
Twitter shares rallied 11 percent in pre-market trade, suggesting an easing of fears about the path forward for the micro-blogging service.
Jan Dawson of Jackdaw Research said in a tweet: “Much better results today from Twitter, across several categories. MAU (monthly active user) growth best for two years (though still historically low).”
Twitter has been seeking to broaden its appeal beyond its core user base of celebrities, politicians and journalists, ramping up efforts in video and live sports, notably.
But the company has failed to live up to early expectations, while Facebook and other social networks have been growing at a faster pace.
It remains to be seen if Twitter will reap benefits from the prolific usage of President Donald Trump, who uses the network to connect with his base, and often to make policy announcements.
Advertising continued to make up the lion’s share of Twitter revenue — but ad revenues were off 11 percent from a year ago to $474 million.
A tweet from Twitter’s investor relations arm noted that “we continue to expect revenue growth to meaningfully lag audience growth in 2017.”
Chief operating officer Anthony Noto said meanwhile that Twitter is delivering for advertisers.
“We believe Twitter is the best place to drive brand perception, and we’re continuing to showcase our unique value proposition for advertisers,” Noto said.