Twitter may have re-oriented itself and laid off part of its workforce to streamline its business, but it still doesn’t look like it is bringing in enough..
Twitter may have re-oriented itself and laid off part of its workforce to streamline its business, but it still doesn’t look like it is bringing in enough money to keep Wall Street happy.
Here is the biggest data point from the company’s fourth-quarter earnings report: according to the company, advertising revenue totaled $638 million, which was down slightly year-over-year. A reversal in its advertising growth is certainly not going to help Twitter’s case, which needs to be able to pitch itself to advertisers as a legitimate alternative to Facebook — and now Snap, which is expected to go public in March and already generated $400 million in 2016.
Twitter needed to show that it could have a strong fourth quarter given that the 2016 U. S. presidential election — probably one of the most Twitter zeitgeist-y moments of all time — happened. Beyond that, President Donald Trump is also an active Twitter user, giving it additional strength as a go-to platform for news. Despite that, revenue for its users in the U. S. was also down. Twitter was essentially gifted one of the largest news cycles and engagement moments it’s probably ever seen in its lifetime, and it still looks like its core issues on monetization are growing.
Not surprisingly, Twitter CEO Jack Dorsey specifically said on the earnings call that 2017 was the year that Twitter would be working on simplifying and building better ad products.
“2017 will be about simplifying and differentiating our revenue products,” he said. “It’ll take time for all the results we want to see.”
Twitter reported earnings of 16 cents per share on revenue of $717.2 million, whereas Wall Street was looking for earnings of 12 cents per share on $740.1 million in revenue in its fourth-quarter earnings report.
