Twitter posts strong sales, forecasts uptick due to ads

TWITTER ADDED 7 MILLION NEW USERS, BRINGING THE COMPANY’S TOTAL AUDIENCE TO 206 MILLION DAILY USERS

NEW YORK: Twitter Inc. reported second-quarter sales that topped analysts’ estimates, and gave a forecast for the current quarter that exceeded expectations amid global events such as the Olympics that drive advertising. Shares jumped about 5% in extended trading.

Revenue will be from $1.22 billion to $1.3 billion in the period ending in September, the San Francisco-based company said Thursday in a statement. Analysts, on average, projected $1.17 billion, according to data compiled by Bloomberg. Secondquarter sales jumped 74% to $1.19 billion from a year earlier, compared with analysts’ estimates of $1.06 billion.

Twitter added 7 million new users in the second quarter from the previous period, bringing the company’s total audience to 206 million daily users. Those numbers were in line with analysts’ estimates. Twitter’s US audience fell 1 million users to 37 million during the period ended June 30.

A year ago, Twitter faced one of its most difficult quarters when many brand advertisers started to pull marketing budgets at the height of the pandemic. The social media company relies on brands for the bulk of its advertising revenue and sales fell 19% in the period from April-June 2020. To broaden its revenue, Twitter started pushing even more aggressively into direct response advertising—the types of ads that try to drive specific outcomes, like an app install or a website visit.

The numbers suggest the firm is growing after a chaotic year that included the pandemic and a US election that ultimately led Twitter to permanently suspend then-President Trump. While brand advertising has bounced back as the global economy reopens, the company remains the target of Trump allies who say the platform discriminates against conservatives. Twitter shares reached a high of $76.70 in extended trading after closing at $69.57. The stock has increased 28% this year.

The company’s brand advertising also may help it avoid any major impact from Apple Inc.’s new privacy updates for iOS 14 users, which require that companies get user permission to collect certain data about their online activity. Most users are asking apps not to track them, which is hurting targeted advertising, especially on Facebook.