Twitter Lacking User Growth

Twitter’s first quarterly earnings report July 29, 2015 since former CEO Dick Costolo stepped down looks like a mixed bag. Though revenue is up 61 percent year-over-year, user growth is slowing. (SocialTimes)

The San Francisco tech company released Q2 earnings Tuesday, including ad sales that were up 63 percent year over year for the quarter, hitting $452 million. Overall, revenue reached $502 million. Still, Dorsey expressed deep dissatisfaction with the pace of growth, and promised that a better user experience is in development. Also, for the first time, Twitter is planning a full marketing blitz to drive more mass adoption of the service. (Adweek)

The company reported that average monthly active users (MAU) were up 15 percent year-over-year to 316 million. That represents only 14 million new MAUs since the end of the first quarter. Most of the sequential growth, about 12 million, comes from SMS fast followers, a metric that Twitter has recently introduced to break out people who receive Twitter updates via text message without going through the normal sign-up process. (THR)

Without these SMS fast followers, Twitter would have had only 304 million monthly active users, compared to 302 million active users with accounts during Q1. That differentiation matters a lot: Users who follow only certain accounts via SMS messaging aren’t using the Twitter app or website, and thus also aren’t seeing most of the company’s ad formats. In other words: These users are good on paper, but add little value to the company. On the domestic front, excluding SMS fast followers leads to an even bleaker picture, with growth flatlined at 65 million MAU for Q1 and Q2. (Variety)

H/T: MorningMedia