Twitter lost six million monthly active users over the past year, its earnings report showed today; a rogue statistic that analysts will soon be unable to track.
This is the last quarter during which the company will report the metric, opting instead to report “monetisable daily active users” (mDAU), defined as those logged in on a given day through Twitter.com or Twitter applications that are able to show ads.
The shift in user metrics has enraged some analysts who see it as moving the goalposts and, met with a warm reception from others.
eMarketer analyst Jasmine Enberg was positive. She said: “Twitter’s decision to share only monetisable daily active users going forward is in keeping with its value proposition to advertisers – a committed though not very large user base when compared with other social platforms.”
Michael Pachter at Wedbush Securities told Reuters: “People are not impressed with a made up metric and their reluctance to give us actual users. I don’t think the stock can get out of its own way until they come clean and report the same metrics everyone else does.”
The figure stood out in otherwise strong-looking earnings: monetisable daily users now stand at 136 million, up 14 million, and ad revenue was up 18 percent year-over-year.
This demonstrates Twitter’s “unique value proposition for advertisers as the best place to launch something new or connect with what’s happening,” said Ned Segal, Twitter’s CFO.
Total revenue was $787 million in Q1, an increase of 18 percent.
The report sent shares spiking upwards 13 percent, adding $3.5 billion to its market capitalisation.
Twitter Earnings: Pivot to Data Business
Noteworthy in the Twitter earnings was the strong growth of its data licensing business, which grew faster than its advertising segment, at 20 percent year-on-year.
Data licensing and other revenue totaled $107 million, the company showed.
“Data and enterprise solutions (DES) continues to see new customer opportunities and use cases as well as smaller customers adopting our self-service APIs” Twitter reported.
The company offers a three-tiered pricing structure for Twitter data; standard, premium and enterprise, with a range of different features/access.
This is widely tapped in the financial services sector, where the average investment firm is now spending about $900,000 yearly on alternative data.
Traders can mine social media and other data for sentiment, volatility and trading signals along with consumer insight and more.
Entering Q2, the company said its investment priorities were to grow its sales teams internationally to better serve large and medium advertisers, and hinted at near-term investment decisions, including in data centre facilities.
The earnings report said: “Platform investments will ensure Twitter is set up for long-term success, both in terms of the data centers that host Twitter, the security of our customers’ data, and the technology our team leverage.”