The top-line is estimated to have benefitted from the steady increase in ad engagements, even as the company continues the efforts to enhance organic growth through aggressive marketing and product improvements. Of late, it has been focusing on alternative revenue streams like live video and advertising.
A key factor that could have influenced the performance in the first three months of the year is the company’s collaboration with various governments to clean-up the platform and weed out security issues, with special focus on curbing misuse of the site for propaganda and spreading misinformation during elections.
The top-line is estimated to have benefitted from the steady increase in ad engagements, further boosting the total advertising revenue
Like its peers in the social media space, Twitter is facing the risk of losing users due to the ongoing drive to remove fake and vicious accounts from the platform. The initiative, launched last year after social networking firms came under fire from regulators for violating data privacy laws, is expected to continue in the coming months.
While reporting the December-quarter results, the management had guided first-quarter earnings below analysts’ consensus estimate. In the fourth quarter, profit more than doubled year-over-year to $0.33 per share, aided mainly by a significant tax benefit and also a 24% growth in revenues to $909 million.
Facebook (FB) and Google (GOOG) are also adopting strict measures to ensure data privacy and rein in fake news after being fined and warned by regulators, mainly by the European Union. Facebook and Google’s Parent Alphabet will be releasing first-quarter results on April 24 and 29, respectively, after the closing bell.
Shares of Twitter have been on a recovery path since early this year, after slipping to a one-year low in the final weeks of 2018. However, the stock is currently trading around 7% below the levels seen a year earlier.