Twitter Inc. added 8 million new users in the second quarter. That slow growth—2.6% quarter over quarter and 15.3% year over year—is a problem, says the social network’s interim CEO Jack Dorsey.
“We’ve been very successful at monetization, with a strong Q2, delivering over $500 million in revenue and more than $120 million in EBITDA,” he said today during a conference call with analysts. “However, product initiatives we’ve mentioned in previous earnings calls…have not yet had meaningful impact on growing our audience or participation. This is unacceptable and we’re not happy about it.”
The slow user growth is widely believed to be at least partially responsible for CEO Dick Costolo resigning in June.
Twitter’s slow user growth overshadowed its continued growth in its advertising revenue. The social network’s ad revenue grew 63.2% in second quarter over the same period a year earlier.
For the second quarter ended June 30, Twitter reported:
- $452.0 million in ad revenue, up 63.2% from $277.0 million a year earlier.
- $502.4 million in total revenue, up 60.9% from $312.2 million.
- Mobile advertising accounted for roughly 88% of advertising revenue, or about $397.8 million, up 77.3% from $224.4 million in the second quarter of 2014.
- 316 million monthly active users, up 15.3% from 274 million in the same period a year earlier.
- Roughly 252 million consumers, 80% of Twitter’s monthly active users, accessed Twitter from a mobile device.
- $136.7 million net loss compared with a $144.6 million loss a year earlier.
For the first half of the year, Twitter reported:
- $840.0 million in ad revenue, up 69.1% from $496.7 million a year earlier.
- $938.3 million in total revenue, up 66.7% from $562.7 million.
- $299.1 million net loss compared with a $277.0 million loss a year earlier.
During the quarter Twitter bought TellApart Inc., a marketing vendor that retailers and other businesses use to retarget consumers on the web and via email marketing, and Whetlab, a startup that focuses on machine learning and artificial intelligence.
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