Twitter Restates User Count, Wrongly Attributed 3rd-Party App Audiences

Janie Parker
October 28, 2017

Shares of Twitter soared over 18 percent on Thursday after the company reported that it expects to be profitable for the first time ever during the next fiscal quarter. Daily actives grew 14% year-over-year, compared with increases of 12%, 14% and 11% over the preceding three quarters on an annual basis.

That quarter was actually 318m, 1m fewer than previously reported.

Twitter discovered that since the fourth quarter of 2014, it had been including users of some third-party applications as monthly active users when they should not have been.

Twitter added 4m new monthly active users in the third quarter - much better than the zero it added in the previous period - hitting 330m.

The social networking site's losses also significantly decreased-Twitter faced a $21 million shortfall this quarter, down from $103 million in the same period past year.

The company did have to concede that it had miscounted its user figures in the second quarter, which masked a drop in its overall total.

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These statistics were released as part of Twitter's earnings report for the third quarter of 2017. This comes after admitting it had overstated - and has revised - its user base going back three years, as it accidentally counted users of a third-party app as its own.

Wall Street rejoiced at Twitter's performance-company stock was up almost 15 percent in morning trading. Users of those third-party applications were able to send authenticated messages via SMS through Twitter's systems, but that didn't relate to activity on the Twitter platform, according to the company's explanation.

"We're pleased with the improvements made toward a return to revenue growth this quarter", Twitter's CFO Ned Segal said in a statement.

It now says the issue was first there in the fourth quarter of 2016, and has made adjustments for it and the following quarters. The fact that the platform is President Trump's favored communications tool is also likely to have raised Twitter's profile among potential users.

On a call with investors, CEO Jack Dorsey reiterated that Twitter is intently focused on improving safety for users. "We'll be taking a more aggressive stance on our abuse rules and on how we enforce them". The site also prohibited photos of non-consensual nudity, and said it would take a harder line on hate symbols and organizations that promote violence.

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