Although Twitter did not have a great start at its IPO back in 2013, things are looking much better for the company in 2014. Yesterday, the company announced its earnings for the second quarter of 2014 and the figures are better than the predictions from the Wall Street.
Twitter posted revenue of $312 million this quarter which was an impressive 129% increase from the same quarter last year. In 2013, Twitter could only generate $139 million in revenue for Q2, so this increase is surely good news for the company. The current earnings show an increase of 25% as compared to its previous quarter during which it could generate only $250 million in revenue.
Wall Street Journal predicted revenues of around $283 million for this quarter, so the actual earnings were much better than predictions.
Along with an increase in revenue, the company notes that its user base too saw healthy growth. In the past three months, the company’s active user base grew to 271 million which means it added 16 million new accounts in the quarter. Twitter also said that its users were more engaged this year with 15% more timeline views as compared to last year.
Timeline views play an important part in generating revenue for the company. The total timeline views by users grew from 157 million in Q1 2014 to 173 million this quarter. The revenue per thousand views too increased to $1.60 in Q2 2014 as compared to last quarter’s $1.44 per thousand views. This also means that the revenue per thousand timeline views for the company increased by 100% this year.
Advertising played a major role in revenue generation for the company. Out of the $312 million posted in revenues, it contributed to around $277 million this year. In comparison, advertising generated only about $226 million in the same quarter last year.
The surge in revenue and user base growth can be attributed to new products and tools developed by the company. Twitter paid special attention to engage users on its micro-blogging website during the Fifa World Cup 2014, which could have improved its earnings for the quarter. Further, profile changes, new advertising contracts, Amazon hashtag promotions etc. could be some of the reasons which led to an increase in revenue for the company.
However, even with this impressive growth, the company continued making losses. This quarter, it posted a loss of $145 million which was higher than a loss of $132 million made last quarter.
But Twitter is positive about its growth and even predicts revenues of around $330 – $340 million in the next quarter.
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