Twitter is profitable again and adding users

Twitter is officially on a profit streak.Twitter posted its second consecutive profitable quarter on Wednesday...

Posted: Apr 25, 2018 1:38 PM
Updated: Apr 25, 2018 1:38 PM

Twitter is officially on a profit streak.

Twitter posted its second consecutive profitable quarter on Wednesday thanks to renewed growth in its ad sales business. The results are a strong signal that the social media company's turnaround efforts are bearing fruit.

The company reported a profit of $61 million for the first three months of 2018, or nearly as much money as it lost in the same period a year earlier. Twitter reported its first profitable quarter as public company in February.

Twitter shares jumped as much as 12% in premarket trading Wednesday following the earnings results, before settling somewhat. It's now up about 5%.

After struggling for much of last year with sagging ad sales and stagnant user numbers, Twitter revealed Wednesday it is now seeing stronger growth in both.

Related: Google's spending spree rattles Wall Street

Twitter posted sales of $665 million for the first three months of 2018, a 21% increase from the same period a year earlier. By comparison, Twitter's ad sales business was shrinking this time last year.

Much of the revenue growth came from Twitter's international markets, which are now on the cusp of overtaking Twitter's U.S. ad revenue. The company is also seeing more traction from videos, which now make up more than half of its total ad revenue.

Twitter has 336 million monthly active users globally, adding six million users from the prior quarter and up from 327 million a year earlier. Nearly all of that growth is coming from overseas: Twitter had 69 million users in the US, unchanged from a year earlier.

Throughout the last year, Twitter has worked to make its product more engaging and intuitive to users by expanding the character limit, threading tweets and highlighting content around events like sports games.

The earnings results come at a sensitive time though. Twitter is one of several internet companies with the potential to face greater user and regulatory scrutiny in the wake of Facebook's Cambridge Analytica data debacle.

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