Amid increased scrutiny into how their platform may have been used to influence voters ahead of the 2016 Election, and renewed criticism over how the company handles its enforcement of trolls and abuse, Twitter has released its Q3 2017 results. And their results beat market expectations, showing moderate increases in all key areas.
First off, on users – Twitter is now up to 330 million monthly active users, which is an increase of four million on the previous quarter.
You may note, however, that the previous monthly stats are slightly different than previously reported –here’s Twitter’s MAU chart from their last report.
As you can see, the numbers vary by a few million – while in the last quarter, when Twitter posted a flat result, they actually saw a decline in usage.
This is due to a calculation error which Twitter explained in their results:
“We discovered that since the fourth quarter of 2014 we had included users of certain third-party applications as Twitter MAUs that should not have been considered MAUs. These third-party applications used Digits, a software development kit of our now-divested Fabric platform, that allowed third-party applications to send authentication messages via SMS through our systems, which did not relate to activity on the Twitter platform. “
It’s a significant misstep, for sure, but the fact that the numbers are now going up is a positive either way. So long as they’re accurate this time.
In terms of daily actives, Twitter’s algorithm-fuelled efforts to show users more relevant content continued to pay off, returning to the 14% growth mark it had hit in Q1.
Twitter did not reveal its full daily active user counts, but CFO Ned Segal said that the figure continues to be less than half of its monthly users, which puts the count at below 165 million DAU (for comparison, Snapchat has 173 million DAU, Instagram has 500 million).
On the revenue front, their third quarter income declined 4.2% to $590 million, compared with $616 million a year earlier. But even with that decline, Twitter still beat analyst expectations, which were in the region of $587 million.
Twitter also lost some momentum with US advertisers, though international ad growth rose by 7% year-on-year, which is a positive moving forward.
The results pleased investors, with Twitter shares rising 12% in premarket trading.
As noted in relation to daily active user growth, Twitter’s been working to improve the user-experience by adding in more ways to uncover relevant content, which has been identified as a key limitation of the platform – there’s a lot of good tweet content out there, but it can be hard to find amidst the fast-moving tweet stream.
Moments was their solution to solve this for new users, but Moments never seemed to pan out the way Twitter would have liked. While it remains a prominent element, Twitter removed the Moments tab back in January, relegated the function to their new Explore tab. This quarter, Twitter’s put more effort into uncovering new content via machine learning methods, adding in a new listing of tweets by topic (based on your usage habits) and a new popular articles module in Explore, based on engagement within your network.
In addition to this, Twitter also added a new ‘Happening Now’ section at the top of user timelines (for US users only at this stage), which will also help them generate more exposure for popular tweet content.
Feel the roar of the crowd, no matter where you are.— Twitter (@Twitter) October 10, 2017
We're rolling out a new way to see what's happening now, starting with sports in ! Available on Android and iOS starting today. https://t.co/lmBFCK4DG0 pic.twitter.com/cv4wL8hCxA
It’s still early days for these additions, it’ll take some time for Twitter to refine them into fully customized relevant listings, but they show that Twitter is working to make the platform more personally relevant, which should help them continue to boost engagement – particularly with regards to their exclusive video content, which will get more focus in 2018.
Whether that’ll bring in more new users is another question - but even if they simply better monetize their existing audience (through continued increased in daily actives), that’s a positive step.
But the biggest change at Twitter in the last quarter was the announcement of their new test of 280 character tweets, which came just last month.
Can’t fit your Tweet into 140 characters?— Twitter (@Twitter) September 26, 2017
We’re trying something new with a small group, and increasing the character limit to 280! Excited about the possibilities? Read our blog to find out how it all adds up. https://t.co/C6hjsB9nbL
Expanded tweets is interesting, no doubt, and it got a lot of people talking at the time, but the novelty seems to have died out fairly quickly, with fewer and fewer extended tweets appearing in timelines. Of course, that’s not definitive, Twitter have the real data on 280 character use, but it seems more like an add-on – it doesn’t seem like the expansion of the tweet limit will help boost usage in any significant way. But time will tell.
On the advertising front, Twitter’s also added a new team to help advertisers maximize their Twitter video efforts in the last quarter, while they also released their new Video Website Cards, which seem like a useful option.
In addition to this, they also announced their new Transparency Center, which will provide data on ads and ad variants, with a particular focus on political ads. It’s yet to be launched, but the new options, while aimed at eliminating questions about electioneering content, could also help advertisers by providing competitor insight – which could be a good or bad thing for marketers, dependent on how it works.
Twitter has also announced that they’re banning all ads from accounts owned by Russia Today (RT) and Sputnik, based on the U.S. intelligence community’s conclusion that both RT and Sputnik attempted to interfere with the election on behalf of the Russian government. It’ll be interesting to see if there are any further ramifications to stem from this decision.
As noted in our recent 2018 predictions post on the platform, Twitter still has many challenges, but there’s also still significant opportunity in the app, especially if their video content plans start to take hold and they can better convert their engaged audience into a stronger avenue for revenue generation. Their algorithm-defined experiments continue to evolve, driving increased daily usage, while their revenue performance has been better than expected.
It’s not booming, it’s not on the same trajectory as Facebook or Instagram, but the results show positive signs for Twitter moving forward.