Twitter announced its quarter 3 earnings on Thursday, registering a growth by 30 percent, and a decline in user base by 9 million. The picture is not as paradoxical as it appears at first since the decline in the number of users is mainly because of its systematic purging of bots, spam and other shady accounts. In the third quarter, user base fell from 335 million to 326 million. Though the purging is done partly to comply with European Union’s GDPR norms, Twitter regards it as a health initiative which will be beneficial for the growth of the platform from a long-term perspective.
In the same quarter in 2017, the user base stood around 330 million. The decline in the number of users is expected to continue through the next quarter. At the same time, the number of people that use the platform daily has increased by 9 percent from last years figures. Jack Dorsey, CEO and co-founder of Twitter, stated that the growth posted in the quarter proves that the company can prioritize the long-term health of the platform and have more people who use it to participate in the public conversation at the same time. The investors who were concerned about the waning user base will now realize that they were worried about a short-term problem that could be remedied.
Twitter’s earnings report for the last quarter is impressive, with sales touching $758 million, marking an increase of about 30 percent over last year’s figures, $58 million more than analysts had predicted. Revenue from ad sales is the major factor behind this; it moved up to $650 million, an increase by 29 percent. More important, the winning streak has been on for a number of quarters, giving a sense of stability to the growth pattern. The report created an excited response in the stock market, where Twitter shares started to move up immediately. A few hours ago, it stood at 13 percent; and it is soaring.