The money is rolling in briskly at Twitter these days, but they’re having a tough time getting more folks on the platform.
Ned Segal, the company’s CFO, said that advertisers increased their spend on Twitter with the return of live events like sports. Segal said the company has also “made progress on our brand and direct response products, with updated ad formats, improved measurement, and better prediction.”
Twitter also announced it had delayed the rollout of its revamped app install ad offering, called MAP, until 2021.
During the quarter, Twitter brought in a walloping $936 million in revenue in the third quarter of 2020, up 37% since last quarter’s disappointing $683 million and up 14% year over year.
Despite the increased revenue, which was driven by rebounding advertising investment, Twitter’s user base barely budged since last quarter. The social media company added only 1 million new users, going from 186 million to 187 million daily monetizable active users (mDAU).
“In Q2, many brands slowed or paused spend in reaction to US civil unrest, only to increase spend relatively quickly thereafter in an effort to catch up,” the company said in its letter to shareholders. “The period surrounding the US election is somewhat uncertain, but we have no reason to believe that September’s revenue trends can’t continue, or even improve, outside of the election related window.”
Twitter’s stock plummeted 16% in after-hours trading after rising 8% during the day.
Twitter has come under fire by Republicans on Capitol Hill for its active approach to combating misinformation and hate speech on its platform. (That was the rationale behind nitronet awarding Twitter CEO Jack Dorsey Digital Executive of the Year earlier this week.)
Dorsey was grilled by the Senate Commerce committee about Section 230 reforms, which would change the way platforms are legally liable for user-generated content. Much of the questioning from Senate Republicans concerned Twitter’s recent decisions to label President Donald Trump’s tweets as misleading and rule-breaking. Republicans also called Twitter on its controversial decision, which the company eventually reversed, to temporarily block the New York Post’s dubious reporting on the Hunter Biden email scandal.
Twitter’s content moderation efforts may be a turn-off to some in Washington. Nevertheless, the company is more interested in appealing to advertisers, who have become more attuned to the larger questions of brand safety and the health of the platform in the last year. Twitter’s own decisions pushed the entire industry this summer to rethink platforms companies’ approach to content moderation. Twitter’s moves in that direction painted a stark contrast with Facebook, which experienced a 1,000-advertiser boycott in protest of its hate speech policies and enforcement in July.
Despite the uncertainty around how the election will affect advertising, Twitter doesn’t need to consider political ads—it banned them outright last year.