Twitter falls shy of analysts’ estimates for revenue in Q2

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on Jul 23, 2020
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  • Twitter falls shy of analysts’ estimates for revenue in the fiscal second quarter.
  • The social media service reports a 34% growth in monetisable daily active users.
  • Twitter faced a serious hack that affected accounts of prominent figures last week.

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Twitter (NYSE: TWTR) published its quarterly financial results on Thursday that fell shy of the experts’ forecast for revenue. The company expressed confidence that its ad business showed moderate recovery in recent weeks.

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Its revenue from this segment, however, still came in 23% lower on a year over year basis in Q2. In the last 3 weeks of June, however, the advertising revenue was only 15% down as compared to the same period last year.

Shares of the company were reported less than 1% down in premarket trading on Thursday. At £29.27 per share, Twitter is currently about 15% up year to date in the stock market after recovering from a low of £17.32 per share in March when the impact of COVID-19 was at its peak. Learn more about why prices rise and fall in the stock market.

Twitter reports a 34% growth in monetisable daily active users

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According to Refinitiv, analysts had expected the company to print £556.59 million in revenue in the second quarter. In its report on Thursday, Twitter said that its revenue came in lower at £537.70 million instead. The company recorded £1.09 of adjusted loss per share in Q2.

Experts had also anticipated Twitter’s monetisable DAUs (daily active users) to come in at 172.8 million in the second quarter. In contrast, the American social networking service boasted 186 million monetisable daily active users that represents a 34% growth versus the comparable quarter of last year.

The San Francisco-based company attributed the increase in DAUs to COVID-19 restrictions and the ongoing debates on the Coronavirus pandemic and social justice. As the health crisis cancelled or postponed major sporting events, Twitter resorted to virtual events in a bid to spark conversations.

Twitter hack affected accounts of prominent figures last week

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Twitter also announced to have completed rebuilding its ad server in the second quarter that is likely to help the company enhance targeting and monetisation of advertisements.

Twitter’s earnings report came in a week after the company faced a serious hack that affected accounts of several prominent figures, including Tesla’s CEO Elon Musk and former President Barack Obama. Elliptic (blockchain analysis firm), published a report last week that claimed to have tracked down a portion of Bitcoins stolen via Twitter.

At the time of writing, the U.S. microblogging and social media company has a market cap of £22.81 billion and a price to earnings ratio of 22.91.

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