Twitter earns $1.19 billion in the second quarter 2021
Twitter earns $1.19 billion in the second quarter, as Jack Dorsey maintains that Bitcoin is the company's future
If Twitter's performance in Q2 is any indication, 2021 is shaping up to be a good year. On July 22, the microblogging company released its earnings report, revealing a total revenue of $1.19 billion.
Twitter's revenue increased by 74% year over year in Q2 2020, demonstrating a remarkable recovery from the harsh economic effects of the Covid-19. Its shares increased by as much as 9% on Thursday evening following the release of its second-quarter 2021 earnings report.
Revenue growth exceeded analysts' expectations for the company. According to Refinitiv, analysts expected Twitter to earn $1.07 billion in revenue, but the company earned $1.19 billion. Following a loss of $1.38 billion in the second quarter of 2020, the company earned $65.6 million.
Capital gains distributions to shareholders also exceeded analysts' expectations. Each shareholder will earn 20 cents per share, rather than the expected 7 cents per share.
Twitter's performance in terms of monetizable Daily Active Users fell short of expectations (mDAU). Its total monthly active users (mDAU) are 206 million, which is lower than the 206.2 million users expected at the quarter's end. It saw an 11% increase in monetizable Daily Active Users, or users who view Twitter advertisements.
The tweaks that led to Twitter’s impressive record
Twitter recently introduced a series of features aimed at assisting users in discovering new reasons to use the platform. It introduced the Tip Jar, Ticketed Spaces, and Super Follows features. Additionally, the features enable users to support creators directly by tipping or purchasing access to exclusive live audio experiences via Ticketed Spaces. Additionally, users can pay for additional exclusive content that is only available through a monthly subscription via Super Follows.
Twitter says that since launching Spaces to compete with Clubhouse's audio service, it has continued to rapidly improve the service.
Apart from enabling all accounts with 600 or more followers to host a Space and expanding ways to discover and drop into Spaces, Twitter says it improved "live captions for accessibility, making Spaces accessible via mobile and desktop web, and adding support for co-hosts, as well as the ability to schedule and set reminders for upcoming Spaces."
It launched over 2,500 new topics in the same quarter, including Fintech, Venture Capital, and Startups, which users can follow and immediately join conversations about. As a result, 41% of new customers in supported languages subscribed to an average of 14 topics during sign-up.
All of these factors contributed to Twitter's retention of users while also establishing it as a platform for real-time conversations.
Despite the platform's continued ban in Nigeria, the tech giant had an impressive second quarter. The United States continues to be the company's strongest market, with revenue increasing 79 percent year on year to $653 million. Japan remains the company's second-largest market, having grown 40% in the third quarter. Japan generates $151 million in revenue, or 13% of total revenue for the quarter.
The company anticipates revenue of between $1.22 billion and $1.30 billion in Q3. This is more than the $1.17 billion predicted by analysts at Refinitiv.
Bitcoin is a ‘big part’ of Twitter’s future
Twitter CEO Jack Dorsey recently revealed that a significant portion of the company's future expansion plans is dependent on Bitcoin. Dorsey has made reference to Bitcoin previously, but this is the first time he is specific about its application.
He continued by explaining that digital currency will be integrated into existing Twitter products and services, such as commerce, subscriptions, and other new features such as the Tip Jar and Super Follows.
Dorsey stated during the investors call, "If the internet has a native currency, a global currency, we can move much faster with products like Super Follows, Commerce, Subscriptions, and Tip Jar, and we can reach every single person on the planet rather than taking a market-by-market approach."
More importantly, the Twitter CEO asserts that there is plenty of opportunity for innovation beyond currency, pointing out how Bitcoin could help further decentralize social media and provide more economic incentives.
With Q2 in the books, the race is on for Twitter to outperform its predecessor in Q3. According to Dorsey's remarks at the shareholder meeting, the company's efforts will soon include Bitcoin, and ultimately, the cryptocurrency will be the focus.
