Twitter flies high in its first ever profitable quarter

8 Feb 2018

Twitter co-founder and CEO Jack Dorsey in Dublin last year. Image: Julien Behal

Twitter enjoys the tweet smell of success as it finds its wings in Q4 2017.

Social network Twitter has reported its first ever profitable quarter, clocking a profit of $91m on Q4 revenues of $732m, which were up 2pc.

This is also the first time that Twitter has reported year-over-year revenue growth in the last four quarters.

Advertising revenues totalled $644m, up 10pc year on year.

International revenues – from outside the US – were up 17pc to $326m.

“Q4 was a strong finish to the year with total revenue increasing 2pc year over year, and owned and operated advertising revenue increasing 7pc year over year, reflecting better-than-expected growth across all major products and geographies,” CEO Jack Dorsey told shareholders.

Average monthly active usage was 330m for the fourth quarter (up 4pc) and Twitter said that Apple’s Safari browser’s app integration made an impact, affecting 1m monthly users and 1m internationally.

Twitter has 262m users internationally and 68m monthly active users in the US.

Daily active users were up 12pc, marking Twitter’s fifth consecutive quarter of double-digit year-over-year daily user growth.

Twitter said that video remains the company’s largest ad format.

“Our live events and in-stream video ads continue to deliver great reach across a large number of premium content categories to advertisers, and have been a source of significant growth within our advertising business,” Dorsey said in a letter to shareholders.

“Our self-serve advertising channel also performed well in Q4, driven by product enhancements and better sales execution. In Q4, we launched a new promoted tweet composer that simplifies the process of creating new promoted tweets.

“Advertisers who had access to the new compose experience created 26pc more promoted tweets and launched 13pc more campaigns, spending 23pc more on Twitter. We also launched a new agency resource centre for mid-sized digital agencies, which drove a significant increase in revenue from smaller ad agencies.”

Dorsey said that in the US, the UK and Japan, Twitter launched its new subscription advertising product, Twitter Promote Mode (TPM).

“Early results have been positive, with significantly better retention among TPM subscribers,” Dorsey told shareholders.

John Kennedy is a journalist who served as editor of Silicon Republic for 17 years