Toronto Star

Twitter losses shrink despite user miscount

Tech firm also announces advertisin­g ban on media outlets backed by Kremlin

- CHAD BRAY THE NEW YORK TIMES

Twitter said Thursday that it had overstated its monthly-user figures since 2014 after mistakenly including data from third-party applicatio­ns in its counting.

The revelation came as the company reported that its net loss had narrowed in the third quarter and that its number of daily active users had risen 14 per cent.

Twitter also announced Thursday that it will ban Russia Today and Sputnik, the two Kremlin-backed internatio­nal news outlets, from advertisin­g on its platform.

The decision marks one of the most aggressive moves by an American social media company against the Russian outlets, which U.S. intelligen­ce officials have linked to a wide-ranging Kremlin effort, both covert and overt, to disrupt the 2016 presidenti­al election.

Twitter said it had earned $1.9 million (U.S.) in advertisin­g revenue from Russia Today since 2011. The company said it would now donate the money to research into the civic impact of Twitter.

Twitter’s reputation has been harmed as the company contends with scrutiny over its role in Russia’s efforts to meddle in U.S. politics, complaints about what critics have called its scattersho­t efforts to prevent abuse and harassment on its platform and skepticism among some investors concerned about its slowing user growth worldwide.

The company said it had discovered that its measure of monthly active users had been improperly including figures from third-party applicatio­ns that used Digits, a softwarede­velopment program.

Digits is part of the Fabric mobile applicatio­n platform that Twitter sold to Alphabet, Google’s parent company, this year.

Digits allowed third-party applicatio­ns to send authentica­tion messages through Twitter’s systems and did not reflect activity on the Twitter platform, the company said.

As a result, the company lowered the number of monthly active users by two million for the first and second quarters of this year and by one million for the fourth quarter of 2016. Twitter said its data-retention policies made it unable to reconcile the figures for periods before then.

“Our estimates suggest the prior period adjustment­s are smaller than those in the fourth quarter of 2016,” the company said.

Twitter said that — in addition to the uptick in daily active users — it had experience­d a 4-per-cent increase in monthly active users from the same period last year, to 330 million. The company had 326 million monthly active users in the second quarter.

Twitter reported a net loss of $21.1 million for the quarter, compared with a $102.9 million loss for the same period last year. The company’s revenue declined 4 per cent, to $590 million.

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