After several quarters of disappointing earnings, Twitter seems to be getting its wings back, adding 9 million more users in the first three months of the year for a new total of 328 million.
In its first-quarter earnings announced today, the company reported revenue of $548 million—down 8 percent over the same period last year, but still better than the $511 million expected by analysts. However, in an earnings letter to investors, Twitter said it expects advertising revenue to “meaningfully lag” audience growth in 2017, with first-quarter ad revenue decreasing 11 percent year over year to $474 million.
“We’re delivering on our goal to build a service that people love to use, every day, and we’re encouraged by the audience growth momentum we saw in the first quarter,” Twitter CEO Jack Dorsey said on an earnings call with investors this morning. “While we continue to face revenue headwinds, we believe that executing on our plan and growing our audience should result in positive revenue growth over the long term.”
Total ad engagements on the platform also seems to be on the up-and-up, rising 139 percent year-over-year, while cost-per-engagement fell by 63 percent over the same period. The company didn’t break out the number of daily active users, but did say that DAU growth accelerated in seven of its top 10 markets worldwide.
Twitter is also exploring other sources of revenue outside of video and display advertising. On an earnings call this morning with investors, Twitter CFO/COO Anthony Noto said the company is also looking into monetizing its Moments feature and logged out version, along with new ways to monetize data or create a subscription option for tools like TweetDeck.
(Revenue from data licensing and other sources totaled $74 million, up 17 percent year-over-year, according to Twitter.)
“We’re leaving no stone unturned as it relates to possible areas for growth,” Noto said.
Video continues to be an area in which Twitter is betting big, with livestreaming leading the way. In the first quarter, it streamed 800 hours of live programming—quite a bit more than the 500 hours it had when it first introduced live video in Q4 last year. Twitter’s live audience also grew by 31 percent, reaching 45 million unique viewers. Of the 450 events streamed from January through March, 51 percent were sports, 35 percent were news and politics and 14 percent were entertainment. Periscope, Twitter’s live video app, accounted for another 77 million hours of user-generated live video content.
A few weeks ago, Twitter lost one of its biggest wins for live video so far when the National Football League made a deal to stream Thursday Night Football this fall on Amazon for $50 million. However, in an interview with Adweek last week, Noto said the NFL was “just one part of a broader strategy” that helped to build awareness about live video on Twitter.
Next week, Twitter will pitch advertisers at its first IAB Digital Content NewFronts event, when it will likely announce additional live video partners for the rest of 2017. While brand safety and media transparency have given other platforms like Google and Facebook headaches as of late, Noto said Twitter wants to be the “gold standard.” To do this, it’s working on getting accreditation from the Media Ratings Council while also bringing on board additional third-party measurement partners.
“We have more than 100,000 advertisers, and the thing that will impact our confidence more than anything else is that when they advertise on Twitter, they achieve their objects on both reach and return on investment,” Noto said. “We think we have that formula.”