Twitter posts its first ever profitable quarter

Twitter’s shares jumped over 20% on news that the social media company returned to revenue growth after reporting its first-ever profitable quarter.

The company’s performance in the last three months of 2017 brings a positive end to an otherwise difficult year. The company instituted a number of changes aimed at making it more competitive with regards to advertising.

The company, which has long trailed being Google and Facebook in terms of building a userbase and advertising revenue, brought in live-streaming video function and doubled its tweet character limit.

But the quarterly figures show that monthly active users remained flat in Q4 2017 at 330 million. Daily active users, however, were up by 12%.

But the company reported that its net income for the quarter was $91 million. This is compared to the $167 million of losses the company took in the same period the year before.

Industry comment

Aaron Goldman, CMO, 4C Insights:

“Twitter's strong quarter is a clear reflection of brands steadily increasing their investment to capitalise on multi-screen marketing. Twitter has become the defacto place for the world to react to news, politics, sport, TV, weather and more.

“As such, it’s a great aperture for brands to deliver timely messages to targeted audiences. We are seeing this momentum carry over into Q1 with major tentpole events like the Golden Globes, GRAMMYs, Super Bowl, Winter Games, and Oscars.”

Nick Fletcher, Vice President, Rakuten Marketing:

“This is a momentous occasion for Twitter. It’s not too surprising, there’s been plenty of talk of the last quarter being a particularly strong one for the platform with monthly active users on the rise again. The compelling question is whether Twitter’s popularity has been driven by Facebook’s recent moves to restructure the news feed less in favour of advertiser and publisher content.

“It remains to be seen whether Zuckerberg’s belief that less time on social media will result in a higher quality of engagement, there’s certainly an argument for it, but for now brands are clearly happy with Twitter’s accomplishments in video and live broadcast and see a growing role for the platform in campaigns.”

Yuval Ben-Itzhak, CEO, Socialbakers:

“Slowed user growth remains a concern when it comes to Twitter, however, live video will be a critical investment for Twitter as content formats and ways to engage with audiences continues to evolve. Twitter has Live video from the Periscope acquisition and now would be the right time to ramp up the Live content format given the reach and engagement brands are seeing from it on other platforms.

“Twitter is clearly trying to make story-telling easier by allowing even more context to its algorithms to make them smarter when it comes to serving ads, with the addition of live formats to its features. This should ultimately help continue to differentiate the platform, drive user engagement and increase the user base.

“At the same time, investment in live videos makes Twitter an even more important platform to consider, providing marketers with new opportunities to define how advertising funds are spent on social media platforms and richer options to share content across multiple ad formats (Live, Pictures, Text) to capitalize on the attention of target audiences.”

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5 Apr 2018, 11:03 a.m.

very useful blog