Twitter surges. Revenues, tick! Profits, tick! Users, tick! Engagement… hey look at those revenues!
Stronger than expected revenues, profits and — critically — user growth led to an extraordinary run on Twitter shares overnight, with the stock spiking more than 30 per cent at one point.
Revenues tipped the scales at $US312 million — almost ten per cent above the Street’s expectations — and that translated to the bottom line, where the company reported profits of two cents a share against an expectation of a loss of one cent per share. And Twitter’s user growth also caught the eye — at over 25 per cent year on year, driven by a strong international performance.
Of course one swallow does not a summer make. Let’s wait and see how sustainable those user number are, given that Twitter — like a lot of traditional media companies — is subject to the vagaries of the news cycle. The last quarter, for instance, coincided with the start of the World Cup in Brazil — something Dick Costolo, CEO of Twitter, acknowledged when releasing the numbers.
And engagement — the infamous Twitter Quitter problem — remains the weakness. This is something the market will rediscover shortly, when it decides to reclaim those overnight gains.
As the New York Times notes in its report, “Twitter faced continuing problems getting people to return to the service, with the average American user refreshing his or her Twitter feed 792 times a month on average during the quarter, less than the first quarter and last year’s second quarter. Globally, usage was down 7 percent from a year ago, but up from the first quarter.”
Still, never let it be said Which-50 didn’t give a sucker an even break. Here are the operational and financial highlighs from the quarter, according to the company:
- Average Monthly Active Users (MAUs) were 271 million as of June 30, 2014 — an increase of 24 per cent year-over-year;
- Mobile MAUs reached 211 million — an increase of 29 per cent year-over-year, representing 78 per cent of total MAUs;
- Timeline views reached 173 billion — an increase of 15 per cent year-over-year;
- Advertising revenue per thousand timeline views reached $US1.60 — an increase of 100 per cent year-over-year.
- New product experiences were built around the FIFA World Cup, including real-time scoring, push notifications, event and match timelines, and a voting ballot feature;
- New web profiles and the ability to send private messages within Vine were introduced;
- New advertiser tools including mobile app promotions — which allow mobile app developers to drive installs and engagements on Twitter — and web site cards — which allow advertisers to surface web site content within a Tweet and drive relevant traffic to any page of their site such as their home page, product page, or an important blog post — were rolled out;
- International expansion of advertising products continued, expanding state/region geo-targeting to help marketers meet local advertising objectives in additional countries including the UK, France, and Indonesia, among others, and launching a self-service ad platform for small and medium sized businesses in Spain, Israel and South Africa;
- Twitter closed the acquisition of Gnip, a leading provider of social data, and entered into agreements to acquire several other companies including TapCommerce, a leader in mobile retargeting and re-engagement advertising, and SnappyTV, a platform for video editing and distribution.
Costolo said at the announcement, “We remain focused on driving increased user growth and engagement, and by developing new product experiences, like the one we built around the World Cup, we believe we can extend Twitter’s appeal to an even broader audience.”