Coronavirus pushed Twitter to a record 24% growth in daily users last quarter, but the social media giant swung to a loss

Mike Blake/Reuters

• Twitter reported first-quarter earnings on Thursday that showed a record 24% year-on-year increase in daily active users to 166 million in the first quarter, which it attributed partially to the coronavirus.
• “In this difficult time, Twitter’s purpose is proving more vital than ever,” Twitter CEO Jack Dorsey said.
• The social media grew revenue by 3%, but swung to a net loss of $8.4 million as the coronavirus pandemic hit home.
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Twitter shares surged more than 5% in pre-market trading on Thursday after the social media group revealed record growth in daily active users last quarter.

The company’s first-quarter revenue and earnings beat the consensus forecast of Wall Street analysts polled by Bloomberg.

Here are the key numbers:

Revenue: $808 million versus $773 million estimated.

Operating income: $7 million loss versus $14 million loss estimated.

EPS: $0.01 versus -$0.03 estimated.

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Twitter’s first-quarter revenues rose 3% as advertising sales inched upward and data licensing and other revenue jumped 17%. However, an 18% increase in costs and expenses fueled a net loss of $8.4 million — a sharp swing from the $191 million profit the company recorded in the first quarter of 2019.

The bright spot was user growth. Twitter’s daily active users ballooned by 24% year-on-year to 166 million, its fastest growth rate as a public company so far.

Twitter also added 14 million users in the space of three months. It attributed the growth to seasonal strength, product improvements, and “global conversation related to the COVID-19 pandemic.”

“In this difficult time, Twitter’s purpose is proving more vital than ever,” Twitter CEO Jack Dorsey said in the earnings release.

“We are helping the world stay informed, and providing a unique way for people to come together to help or simply entertain and remind one another of our connections.”

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Dorsey will surely be relieved by the strong user growth. Activist investor Elliott Management called his position as CEO into question earlier this year, suggesting his attention was divided by his other CEO position at Square. It also questioned his plan to move to Africa for several months.

The parties struck a deal last month to keep Dorsey in power. He no longer plans to move to Africa.

Twitter declined to provide revenue or operating income forecasts for the second quarter, citing “unprecedented uncertainty and rapidly shifting market conditions.”