Twitter ad sales soar, shares up 11%

NEW YORK (Reuters) – Twitter Inc. easily beat Wall Street's earnings and earnings forecast on Thursday, pushing its stock up 11 percent ahead of the opening bell, as the increase in ad sales offsets the decline the number of monthly users, the site having deleted the suspected accounts of abuse.

Quarterly advertising revenues jumped 29% to $ 650 million from the previous year, thanks to sales of ads broadcast by media companies such as Live Nation Entertainment, Major League Baseball and the Major League Soccer.

According to Refinitiv data, total revenues increased by $ 758 million over the previous year, compared to an average of $ 702.6 million by analysts. The company announced an adjusted profit of 21 cents per share, well above the average estimate of 14 cents.

The company downplayed a larger-than-expected decline in the number of monthly active users, claiming that it was focusing on removing accounts used for misinformation, hate speech and other abuses in order to consolidate a base Attractive high quality users for advertisers.

Twitter has removed millions of suspicious accounts after its use and other social media services have been used in misinformation campaigns to try to influence voters during the 2016 US presidential race and Other elections. Last week, he revealed he had removed some 10 million tweets which, he said, were the result of influence operations supported by the Russian and Iranian governments.

During a conference call Thursday, Twitter said the clean-up efforts launched in March and dubbed "initiative" in the field of "health" will allow it to increase its revenue faster than users during a extended period.

"Health is ultimately a growth driver for the service, and we believe that it is important not only for the overall experience, but also to make Twitter sustainable in the long run," said the director. General, Jack Dorsey, during the call.

DROP FROM THE USER

According to FactSet, the number of monthly active users fell to 326 million in the third quarter, which is lower than the average forecast by analysts of 331.5 million. Twitter said it expects them to fall below the 326 million mark during the current quarter, exceeding the average forecast of 333.4 million.

While shares on Twitter fell 19% after a similar decline last quarter, third-quarter earnings and earnings, better than expected, eased worries.

"If they get rid of robots, fake accounts and fight against hate speech, it's really good for the health of the platform in general," said Brian Wieser, analyst at Pivotal Research. Group. "It's certainly more attractive to advertisers."

These concerns have been somewhat offset by the increase in video advertising sales which suggests that the company manages to generate more money from each user and that investors are looking for strong evidence that this would lead to sustainable growth in revenues and revenues. profits.

"Twitter continues to" do a lot with a little. "The growth in the number of users is dull, but the company is demanding more from current users," said Jim Cridlin, Global Head of Innovation for the Purchasing Firm. of WPs Mindshare Media.

Distribution contracts with Major League Baseball, video game publisher Activision, Sony Music and Vice are beginning to attract advertisers to Twitter's premium video, he said.

Twitter said the number of daily active users was up 9 percent year-over-year, down from the 11 percent jump in the previous quarter and its slowest two-year growth rate. The company does not disclose the total number of daily users.