Twitter Expands Misinformation Rules Ahead of US Election

Latest: Twitter Says US Presidential Elections Could Hurt Advertisement Sales

Latest: Twitter Says US Presidential Elections Could Hurt Advertisement Sales

Twitter on Thursday added fewer users than Wall Street had expected and said a rise in expenses would accelerate in the fourth quarter, sending its shares tumbling 16 percent.

The San Francisco-based social media company said it expected expenses to increase by close to 20 percent in the fourth quarter compared with a year ago due to an increase in investments.

The company also cautioned that it was hard to predict how advertisers would react as the US presidential election nears on November 3.

Shares of Twitter fell to $44 (roughly Rs. 3,200) in after-market trading.

Twitter said many companies paused ad spending during the second quarter due to widespread protests after the death of George Floyd in May and said there could be a similar dynamic with the US election.

Twitter said it had 187 million monetisable daily active users (mDAU) during the third quarter, missing consensus analyst expectations of 195.2 million users, according to IBES data from Refinitiv. The figure stood at 186 million in the previous quarter.

Still, total revenue grew 14 percent year-over-year to $936 million (roughly Rs. 7000 crores) during the quarter ended September 30, beating analyst estimates of $777.15 million (roughly Rs. 5,800 crores).

The growth was helped by updated advertising formats, improved ad measurement and the return of events that had been paused due to the pandemic, said Twitter Chief Financial Officer Ned Segal during an earnings call with analysts.

The company said outside of the election period, it expected revenue trends could continue or even improve in the current quarter.

Ad revenue in the third quarter grew 15 percent to $808 million (roughly Rs. 6,000 crores) from the same period a year ago, surpassing estimates of $645.95 million (roughly Rs. 4,800 crores).

The company said it would delay the launch of a new advertising product until 2021 as it worked to integrate new mobile phone data privacy requirements.

Costs and expenses grew 13 percent from the same period last year to $880 million (roughly Rs. 6,600 crores), as the company said it spent more on infrastructure-related expenses.

Net income in the third quarter was $28.66 million (roughly Rs. 213 crores), or 4 cents (roughly Rs.3) per share, down from $36.5 million (roughly Rs. 272 crores), or 5 cents (roughly Rs. 40) per share in the year-ago quarter.

© Thomson Reuters 2020


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