MASTERCLASSING

Twitter's profitability rolls on despite active user slump

Tyrone Stewart

TwitterTwitter has managed to achieve an entire year of profitability after announcing profit for the fourth quarter in a row. In the third quarter of 2018, the social media firm brought in $758m in revenue with a net income of $106m and earnings of 21 cents per share.

Compared to Wall Street estimates, Twitter exceed the $703m revenue and 14 cents earnings per share predicted by analysts.

Profits continued to edge their way up for Twitter despite its monthly active user (MAU) base significantly declining from 335m in Q2 2018 to 326m in Q3 – below Wall Street’s 330m user prediction. The 9m user hit has been attributed to the platform’s work to identify and remove automated, spammy, and malicious accounts. Furthermore, Twitter says that GDPR, its decision not to move to paid SMS carrier relationships in certain markets, product changes to reduce automated usage, and technical issues around notifications are also factors in the decline in MAUs.

“We’re achieving meaningful progress in our efforts to make Twitter a healthier and valuable everyday service,” said Twitter CEO Jack Dorsey.

“We’re doing a better job detecting and removing spammy and suspicious accounts at sign-up. We’re also continuing to introduce improvements that make it easier for people to follow events, topics and interests on Twitter, like adding support for U.S. TV shows in our new event infrastructure. This quarter’s strong results prove we can prioritize the long-term health of Twitter while growing the number of people who participate in public conversation.”

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