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Twitter today reported strong revenue growth for Q3 2020, while monetizable users were up year-on-year (YoY) but fell short of estimates. The social networking giant announced its most recent financial and user metrics this afternoon, breaking a long-standing tradition of announcing earnings before the market opens.
The day after CEO Jack Dorsey faced a grilling from the U.S. Senate over how social media companies moderate content, Twitter revealed revenues of $936 million — a year-on-year (YoY) increase of 14% from the $824 million reported last year and a quarter-on-quarter (QoQ) increase of 37% over the $686 million for Q2 2020. The company added that its net income for the quarter fell around 22% from last year to just under $29 million.
In the earnings press release, Twitter CFO Ned Segal noted that the revenue hike was largely due to advertisers increasing their spend around live sports and other events after holding back in previous quarters because of the pandemic.
As with the previous quarter, Twitter hadn’t provided any revenue guidance ahead of its Q3 2020 financials, due to the impact of COVID-19, but analysts had pegged Twitter’s revenue for the quarter at roughly $775 million, while mDAUs had been estimated to reach more than 196 million.
In short, Twitter smashed it on revenue but disappointed on user growth.
Twitter’s shares are sitting at roughly double their March value, having hit a five-year high of more than $52 this week. However, off the back of lower-than-expected user growth, Twitter’s shares plunged up to 12% in after-hours trading.
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