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28 October 2017, 01:11 | Clyde Nash
Henry Dombey | Vox Media
Twitter released its third quarter results report Thursday and revealed that it miscalculated the amount of users it had by millions. The site's number of daily active users also increased 14 percent.
Earnings (adjusted): $0.10 a share versus $0.05 expected.
Twitter slightly beat Wall Street's expectations for its third-quarter earnings with $590 million in revenue vs. $587 million expected.
The social networking site's losses also significantly decreased-Twitter faced a $21 million shortfall this quarter, down from $103 million in the same period previous year. This comes after admitting it had overstated - and has revised - its user base going back three years, as it accidentally counted users of a third-party app as its own.
Twitter Inc. has admitted to incorrectly reporting its single most important metric, monthly active users (MAUs), for almost three years.
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The company did have to concede that it had miscounted its user figures in the second quarter, which masked a drop in its overall total.
"This quarter we made progress in three key areas of our business: we grew our audience and engagement, made progress on a return to revenue growth, and achieved record profitability", Dorsey wrote in a press release.
"We discovered that since the fourth quarter of 2014 we had included users of certain third-party applications as Twitter MAUs that should not have been considered MAUs", the company wrote in its October 26 letter to shareholders and accompanying press release. Twitter's current user base sits at approximately 330 million.
The applications used a software development kit called Digits, "which did not relate to activity on the Twitter platform", read an excerpt from the letter. The company said it didn't have exact data for periods before the fourth quarter of 2016, but that those losses would be the same or smaller than the four quarters reported.
Revenues fell 4.2% from previous year to $590 million, but also beat analysts' view for $586.22 million. The fact that the platform is President Trump's favored communications tool is also likely to have raised Twitter's profile among potential users.
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