Twitter pops after beating sales estimates, adding the most new users in 2 years
- Shares of Twitter rose 7% in early trading on Friday after the social-media platform reported second-quarter financial results.
- Twitter added 5 million users during the period and recorded revenue of $841 million, propelled by a 21% year-over-year increase in ad sales and beating expectations of $829 million.
- The company said it anticipates third quarter revenue to be between $815 million and $875 million, while analysts are targeting $872 million.
- Watch Twitter trade live.
Twitter's stock jumped 7% in early trading on Friday after reporting second-quarter sales that beat Wall Street forecasts.
The social media platform generated $841 million in revenue, surpassing the $829 million predicted by analysts. The strong sales were fueled by a 21% jump in advertising revenue from the same period last year. Ad sales accounted for $727 million of Twitter's $841 million in revenue. Profits came in at $37 million, or $0.05 per share.
Twitter grew users to 139 million during the period, up from 122 million during the same quarter last year, representing the largest year-over-year increase since summer 2017. Analysts surveyed by Bloomberg estimated users would hit 135.4 million. Most of the growth came in the form of international users, which account for 110 million of Twitter's userbase.
The company said it expects third quarter sales to land between $815 million and $875 million, compared to the $872 million anticipated by Wall Street. The dimmer guidance comes as the company plans to shutter some ad formats in future quarters.
"We've made the decision to shut down some revenue products that were big enough that they might impact near-term revenue,but small enough that they weren't long-term priorities," Ned Segal, Twitter's chief financial officer said. "Instead, we are focused on our most important products, delivering higher performing, better formats for our customers."
The role of Twitter and other social media platforms in political elections has come into greater focus this year in light of Special Counsel Robert Mueller's investigation into disinformation campaigns. Chief Executive Officer Jack Dorsey said the company has been making strides toward improving Twitter's ability to tackle the issue.
"We also continued our work to proactively identify and address malicious behavior, resulting in an 18% drop in reports of spammy or suspicious behavior across all Tweet detail pages, which show the replies to any given Tweet on our service," he said in a prepared statement.
Twitter was up 33% year-t0-date through Thursday.
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