Twitter fights off fear of failure with solid second quarter numbers

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If earnings reports could beam, Twitter’s second quarter results were positively glowing. The social network, which has been slow to find its way to profitability, announced Tuesday it added 16 million users in the quarter ending June 30 and eked out a tiny profit. In short: Skeptical analysts and haters to the left.

Twitter brought in $312 million in the second quarter, $277 million of which came from advertising. Not surprisingly, mobile ads made up the bulk of that revenue at 81 percent. The network now has 271 million monthly active users, up 24 percent over the same quarter last year.

That number still isn’t where CEO Dick Costolo and the hawks watching Twitter’s stock would like to see it, and surprisingly wasn’t boosted much by the action Twitter drummed up around the World Cup. Costolo said the World Cup drove engagement from existing users, but didn’t attract many new ones. The growth in active users came from changes Twitter has made to signing up and finding new users, he added.

“During the World Cup, we delivered the kind of events experience that I’ve wanted to see from us for some time,” Costolo said during Tuesday’s earnings call with analysts. “We served up tailored experiences for each individual match and for the overall World Cup. These experiences felt alive, they felt wonderfully complementary to the matches themselves. That has given me confidence that we can create great user experiences around topics and live events.”

dick costolo Joi Ito

Twitter CEO Dick Costolo isn't yet happy with where Twitter is, but says he has big plans for the company's future.

More eyeballs, not so many users

Costolo prefers to emphasize other, more impressive numbers than simple active user counts because he thinks metrics like timeline views and unique visitors are more representative of Twitter’s influence. Timeline views have jumped to 173 billion, up 15 percent over last year. That number reflects how many eyeballs are on Twitter’s feed at a given time, and therefore how many views advertisers are attracting. Twitter is now earning $1.60 per thousand timeline views in ad revenue, up 100 percent year-over-year.

There are hundreds of millions of unique visitors who visit and never log in, Costolo said, which means the network’s reach is two to three times the size of its reported monthly users. When Twitter redesigned web profiles, it came as a surprise: Twitter’s active users rarely look at those profiles, because they display your own tweets instead of the stream of other tweets you seek when you check out your timeline.

That redesign wasn’t meant for Twitter devotees. It was Twitter’s way of appealing to the casual visitor who browses specific users’ tweets without logging in.

twitter redesign

Twitter's profile redesign wasn't meant for devoted users, but to casual viewers who never log in.

“By giving everyone the best of Twitter, no matter where or how they consume our content—logged in, as unique visitors, or in syndication—we will position ourselves to reach the largest audience in the world and every person on the planet,” Costolo said.

The company is committed to drawing active users back for more and making newbies’ experiences better—and, of course, getting those unique viewers to sign up and actually use Twitter. You can expect to see more tweaks to direct messaging and other changes that will improve Twitter, but not “radically change” it, Costolo said. But the CEO wouldn’t rule out switching to an algorithm-based timeline from a chronological one and didn’t say what other experiments the network plans to test this year.

This story, "Twitter fights off fear of failure with solid second quarter numbers" was originally published by TechHive.

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