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Twitter doubles ad revenues

News, 09 February 2015

SAN FRANCISCO: Ad revenue at microblogging site Twitter almost doubled in the fourth quarter of 2014 compared to the same period a year earlier, despite a slowdown in the growth rate of monthly users.

In an earnings call, chief financial officer Anthony Noto revealed that ad revenue in the final quarter of last year had reached $432m, up 97% year-over-year. This was, he said, "driven by strong growth in both the number of advertisers and average revenue per advertiser in each channel and geography".

These figures distracted from the addition of only 4m users during the quarter, bringing Twitter's total to 288m monthly active users.

This was not helped by a loss of 4m monthly active users during the quarter which CEO Dick Costolo attributed to "an unforeseen bug in the release of iOS8". But he added that things had picked up in January and he expected that the first quarter of 2015 would revert to the trends seen in the first three quarters of 2014.

The acquisition last month of Indian business ZipDial is one of the factors expected to boost user numbers in the coming months, as Twitter tweaks its service for emerging markets, for example, enabling owners of feature phones to receive Tweets via SMS.

Costolo also announced he was targeting the Cricket World Cup, which starts this month, aiming to provide fans with "an immersive experience similar to what we provided for the FIFA World Cup last summer".

Among the other initiatives being undertaken, he outlined how a focus on video was progressing – "The data all tell us that people love watching video on Twitter and marketers are seeing great engagement along with tons of earned media" – and said he was devoting a lot of his time to this area.

And a new deal with Google will see Tweets showing up in searches which, Costolo expected would "drive traffic and distribute traffic to our logged out experience" – a logged out homepage where they can sign in or sign up and where, presumably, a number of ads will also be delivered.

Data sourced from Seeking Alpha, Financial Times; additional content by Warc staff