Twitter Cites Mobile Application Promotion, International User Growth for Solid Q1

Twitter posted a solid year-over-year revenue gain of 28% in the first quarter of 2021 to $1.04 billion from $808 million last year, crediting a March surge in brand advertising on its platform, along with accelerating growth in mobile application promotion (MAP) revenue. The company said U.S. revenue of $556 million was up 19% compared with the first quarter of 2020, while international revenue spiked 41% to $480 million. Japan—the social network’s second-largest market, behind the U.S.—accounted for $170 million of Twitter’s revenue, 16% of its total and up 30% year-over-year. Twitter’s total advertising revenue was $899 million, up 32% from the same period last year, and it said total ad engagements were up 11%, while cost per engagement rose 19%. The company reported $68 million in generally accepted accounting principles net income compared with a net loss of $8 million in the first quarter of last year. Chief financial officer Ned Segal said in a statement, “Q1 was a solid start to 2021, with total revenue of $1.04 billion, up 28% year-over-year, reflecting accelerating year-over-year growth in MAP revenue and brand advertising that improved throughout the quarter. Advertisers continue to benefit from updated ad formats, improved measurement and new brand safety controls, contributing to 32% year-over-year growth in ad revenue in Q1.” Twitter tallied 199 million monetizable daily active users (mDAUs) as of March 31, up 20% compared with the same time last year and up 7 million versus the fourth quarter of 2020. International markets paced its growth, with 162 million mDAUs, up from 155 million in the previous quarter and 133 million in the first quarter of 2020. The needle moved much slower in the U.S., as Twitter finished the first quarter with 38 million mDAUs, up slightly from 37 million at the end of last year and from 33 million in the same quarter last year. Second quarter projections Twitter projected its revenue for the second quarter of 2021 at $908 million to $1.08 billion, and it projected low-double-digit mDAU growth rates over the last three quarters of the year. CEO Jack Dorsey said in a statement, “People turn to Twitter to see and talk about what’s happening, and we are helping them find their interests more quickly while making it easier to follow and participate in conversations. Average mDAU reached 199 million, up 20% year over year and up 7 million sequentially, driven by ongoing product improvements and global conversation around current events.” Twitter credited key verticals including cryptocurrency and sports betting as helping to drive adoption of its MAP products. It also attributed some of its increased advertiser demand to new products including Curated Categories and a new campaign setup experience for brands, particularly affecting its Amplify in-feed pre-roll and sponsorship video ad offerings. The company said it is clearly too early to understand the impact of the changes to the Apple ecosystem brought on by the release of its iOS 14.5 operating system this week, but it pointed out that its expanded integration with SKAdNetwork, Apple’s proprietary measurement solution, has thus far boosted the number of iOS devices that it can serve MAP ads to by 30%, while maintaining consistent cost-per-install performance. First-quarter highlights on the user experience front that Twitter detailed in its letter to shareholders included its test of Clubhouse clone Twitter Spaces and the expansion of that feature to Android, as well as enabling people to upload and view 4K images, the rollout of more than 700 new international topics and deeper coverage within its U.S. topics. The company also kicked off its pilot of Birdwatch, a community-driven approach to stopping the spread of misinformation on its platform by empowering its users to identify potentially troublesome tweets and write notes on them for other Birdwatch participants to view. Twitter said in its letter to shareholders, “We continue to enhance the global conversation on Twitter with live and on-demand video content, including short videos and highlights, across sports, entertainment, gaming, news and politics. In Q1, we worked with the National Basketball Association to invite students of Historically Black Colleges and Universities to be media correspondents interviewing the NBA’s biggest stars—exclusively distributed on Twitter over All-Star Weekend. We also saw innovations from our content partners on Twitter Spaces, with the Grammys Official After Party and the Premiere Lacrosse League draft both hosted on Twitter Spaces in Q1.” Facebook Expects ‘Ad-Targeting Headwinds’ From Apple’s Privacy Changes