Twitter posts first net profit

Twitter Inc yesterday reported its first quarterly net profit and topped Wall Street targets as video ad sales rose, while a clampdown on fake accounts brought the number of people using the social network in below expectations.

Twitter’s previous inability to turn a profit had confounded investors given the company’s ubiquitous presence in the media and popularity among celebrities, athletes and politicians such as US President Donald Trump.

The company in October had signaled the breakthrough was possible as it slashed expenses.

Twitter swung to a net profit of $91.1 million, or 12 cents per share, in the fourth quarter, from a loss of $167.1 million, or 23 cents per share, a year earlier. Adjusted profit was 19 cents per share, topping analysts expectations of 14 cents per share, according to Thomson Reuters I/B/E/S.

Revenue rose 2% year-over-year to $731.6 million, the first increase since the fourth quarter of 2016, beating Wall Street’s target of $686.1 million, according to Thomson Reuters I/B/E/S.

Still, Twitter missed Wall Street targets for people using the service, reporting 330 million monthly active users for the quarter, a 4% increase from a year earlier but flat from the third quarter. Analysts on average had expected 332.5 million monthly active users, according to financial data and analytics firm FactSet.

The tally of users is closely watched by investors as a sign of future ad sales potential.