Ad-tech problems, weak revenue eclipse Twitter user growth

Ad-tech problems, weak revenue eclipse Twitter user growth

SAN FRANCISCO — Bugs in Twitter’s advertising technology dragged on revenue, overshadowing a surprisingly strong quarter of user growth.

The issue caught Wall Street off guard Thursday and shares plunged 19%, among the company’s largest single-day losses since going public six years ago.

The San Francisco company said it’s addressing those issues, but that they will likely weigh on its advertising business in the near term. It lowered its outlook for the fourth-quarter and for the year.

The problems shifted the attention of industry analysts away positive trends in usage on Twitter, which would typically imply strong revenue growth ahead.

The number of people using Twitter daily in the most recent quarter jumped 17% to 145 million compared with the same period last year, and increased by 6 million from just the previous quarter.

That is 3 million more users than industry analysts had expected, according to a survey by FactSet.

“These bugs affected our ability to target ads and share data with measurement and ad partners,” said Ned Segal, chief financial officer. “We also discovered that certain personalization and data settings were not operating as expected. These issues were in our control and we will work to do better.”

Net income was $37 million, or 5 cents per share. Removing non-recurring charges, per-share profit was 17 cents, 3 cents shy of Wall Street expectations, according to a survey of industry analysts by FactSet.

It was a 65% drop from last year’s adjusted profit of $106 million.

Revenue was $824 million, an increase of 9% over the same period last year, but well short of Wall Street’s projections of $874 million.

Citi analyst Hao Yan said fixing bugs in the company’s ad platform will be a priority, but sees it as a drag on revenue at least in the near term.

Twitter started disclosing its daily user base earlier this year. These are users who log into the site at least once a day and see advertisements on the platform. Twitter says the daily metric is replacing its monthly user count, which it will no longer disclose.

The company said it has made progress on what it calls the “health” of its platform. The microblogging service, which has been criticized in the past for not doing enough to combat abusive comments and users, says it has been proactively identifying and removing such content. CEO Jack Dorsey said Thursday that more than 50% of the tweets removed for abusive content last quarter were taken down before they were reported.

Twitter now projects fourth-quarter revenue of $940 million, the lower end of its previous guidance range and short of the $1.1 billion analysts were looking for.

Advertising revenue came to $702 million for the quarter, an increase of 8% over the third quarter last year.

The company said data licensing and other revenue totalled $121 million, an increase of 12% over 2018’s third quarter.

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

Paul Harris, owner of Tribe restaurant downtown, said a lot of the blame for the latest restrictions that will close outdoor patios on Sunday can be blamed on those not obeying health regulations and the government for failing to enforce the rules.
Photo by Paul Cowley/Advocate staff
Restaurant owners frustrated by patio shutdowns

Outdoor patios must stop serving by midnight Sunday to stem rising COVID infections

The City of Red Deer said Wednesday that some outdoor activity rentals will be available starting Monday for households only. (Advocate File Photo)
City of Red Deer outlines activities available as new provincial COVID-19 restrictions set in

There will be limited recreation activities available across the City of Red… Continue reading

As of Friday, Alberta has under 10,000 active COVID-19 cases. (Image courtesy CDC)
Alberta reports 2,271 new COVID-19 cases, Red Deer cases rise slightly

Across Alberta, there are 666 people in hospital with COVID-19, including 146 in the ICU

‘Love, Oran’ is a documentary feature made by Red Deer-raised filmmaker Colin Scheyen. It’s about hidden letters, found in a Woodlea home after 70 years, revealing a family secret. (Screenshot by Advocate staff).
Hidden letters reveal secrets of Red Deer family in a new documentary film

‘Love, Oran,’ by filmmaker Colin Scheyen is showing at Edmonton’s NorthwestFest

Red Deer Rebels’ three graduating players, Josh Tarzwell (left), Chris Douglas (middle) and Ethan Anders (right) will all move on to new opportunities next season. (Photo by ROB WALLATOR/Red Deer Rebels)
‘It was a rollercoaster’: Rebels’ graduating players look back on wild season

The nerves. Even three-and-a-half-years later, Josh Tarzwell still remembers the nervousness he… Continue reading

Jets beat Flames 4-0 to snap seven-game losing streak and clinch playoff spot

Jets beat Flames 4-0 to snap seven-game losing streak and clinch playoff spot

Team Canada skip Kerri Einarson, left, directs her teammates, lead Briane Meilleur, right, and second Shannon Birchard, against Estonia at the Women's World Curling Championship in Calgary, Alta., Wednesday, May 5, 2021.THE CANADIAN PRESS/Jeff McIntosh
Canada’s Einarson extends win streak to four games at world curling playdowns

Canada’s Einarson extends win streak to four games at world curling playdowns

CF Montreal head coach Wilfried Nancy, left, talks with midfielder Lassi Lappalainen during the second half of an MLS soccer match against Columbus Crew, Saturday, May 1, 2021, in Fort Lauderdale, Fla. The game ended in a 0-0 tie. (AP Photo/Lynne Sladky)
Canadian MLS teams try to make best of relocation

Canadian MLS teams try to make best of relocation

Damian Warner, of Canada bronze, smiles during the medal ceremony for the decathlon at the World Athletics Championships in Doha, Qatar, Friday, Oct. 4, 2019.  THE CANADIAN PRESS/AP-Nariman El-Mofty
Decathlete Damian Warner says being a dad has brought balance and new perspective

Decathlete Damian Warner says being a dad has brought balance and new perspective

Toronto Blue Jays' Vladimir Guerrero Jr. gestures rounding third base after hitting his third home run against the Washington Nationals during the seventh inning of a baseball game Thursday, April 27, 2021, in Dunedin, Fla. (AP Photo/Mike Carlson)
Blue Jays shuffling back to Buffalo starting June 1

Blue Jays shuffling back to Buffalo starting June 1

Bedard, Wright lead Canadians into gold-medal game at U18 championship

Bedard, Wright lead Canadians into gold-medal game at U18 championship

Canada players are seen prior to the match against Costa Rica as part of the 2021 CONCACAF Futsal Championship in Guatemala City, Guatemala in this Wednesday, May 5, 2021 handout photo. THE CANADIAN PRESS/HO, CONCACAF, Straffon Images, Norvin Mendoza *MANDATORY CREDIT*
Canada loses to Costa Rica but advances at CONCACAF Futsal Championship

Canada loses to Costa Rica but advances at CONCACAF Futsal Championship

Yukon Premier Sandy Silver addresses the audience at the Yukon Government swearing in ceremony, in the Yukon Government Legislature foyer, in Whitehorse, Monday, May 3, 2021. The Yukon government says travelers who can prove they've been fully vaccinated against COVID-19 will no longer be required to self-isolate when they enter the territory beginning May 25. THE CANADIAN PRESS/Mark Kelly
Yukon to lift requirement of 14-day self-isolation for arriving travellers on May 25

Yukon to lift requirement of 14-day self-isolation for arriving travellers on May 25

Most Read