User growth slowed down dramatically from earlier in 2020, however
Twitter fell short of Wall Street’s user growth expectations, but topped analysts’ revenue and earnings estimates when it posted its fourth quarter results on Tuesday afternoon.
Between October and the end of December, Twitter added 5 million daily active users, bringing the company to 192 million DAUs overall. That marked an increase of 27% year-over-year, but analysts had expected that number to be closer to 193 million DAUs. After adding a company-record 20 million daily users during Q2, Twitter added a combined 6 million new daily users during the second half of 2020.
On the financial side, Twitter posted its second quarter ever with $1 billion in sales or more, with the company bringing in $1.29 billion during Q4, beating analyst projections of $1.20 billion. Sales were up 28% compared to the same time last year. Earnings per share of $0.38 also topped projections of $0.31 EPS. Most of Twitter’s Q4 revenue, as usual, stemmed from its ad business, with ads accounting for $1.16 billion in sales. Earlier this week, Bloomberg reported Twitter is looking to add revenue streams, including an option to tip users for exclusive content, in an effort to move beyond being so reliant on ad sales.
Notably during the fourth quarter, Twitter made the decision to block users from sharing reports from the New York Post on Hunter Biden, son of then-Presidential nominee Joe Biden. Twitter claimed the Post’s initial report — which said Hunter Biden introduced his dad, former Vice President and current President-elect Joe Biden, to a “top executive” at a Ukrainian energy company, before pressuring Ukrainian lawmakers to fire a prosecutor looking into the company a year later — was “potentially harmful.” Twitter also said the report violated its rules against sharing “hacked materials,” although it wasn’t clear the reports were based on hacked information. The decision, which came weeks before the 2020 election, was skewered by many who felt Twitter’s censorship polices had gone too far. CEO Jack Dorsey later admitted the company’s handling of the ordeal was “unacceptable.”
Later, during the early days of Q1 2021, Twitter permanently banned Donald Trump from its platform,citing “the risk of further incitement of violence.” The decision came after supporters of then-President Trump stormed the U.S. Capitol on Jan. 6.
“After close review of recent Tweets from the @realDonaldTrump account and the context around them we have permanently suspended the account due to the risk of further incitement of violence,” Twitter said at the time.
More to come…
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