Twitter First Real Profit, Twitter's Q4 better than expected,Twitter Shares Surge 15 Percent on First Quarterly Profit , II Twitter Posts First Real Profit, Sending Shares Soaring , II Twitter's Q4 better than expected, first GAAP profit as revenue model develops

Twitter Inc. posted a surprise gain in revenue, the first growth in four quarters, driven by improvements to its app and added video content that are persuading advertisers to boost spending on the social network. The shares surged.

 The company topped analysts’ average sales estimates in the fourth quarter and for the first time posted a real profit, a milestone in Chief Executive Officer Jack Dorsey’s turnaround effort. Monthly active users were little changed from the prior quarter at 330 million, a lower-than-projected total that the company attributed in part to stepped-up efforts to reduce spam, malicious activity and fake accounts.

The report adds to positive momentum in recent months for Twitter, which spent the second half of 2017 explaining how Russian-linked accounts -- including automated bots -- influenced content on its platform around the 2016 U.S. presidential election. Dorsey, who also runs Square Inc., has been working to broaden Twitter from a microblogging site into a destination for users to see "what’s happening now” by striking live-streaming partnerships with news outlets and sports leagues.

 The shares soared 15 percent in early trading in New York after closing at $26.91 Wednesday. 

Twitter’s focus on video, as well as a new software algorithm that shows users the most relevant postings first, have led people to spend more time on the platform, said Richard Greenfield, an analyst at BTIG.
"I think they’ve come a long way,” Greenfield said. “The product has dramatically improved. They’re doing a better job of showing the right tweets to the right people at the right time."
Twitter has been upgraded by at least six analysts since late October, fueling a stock rally of more than 47 percent in the past year. Shares jumped as much as 9.5 percent in one day last month amid renewed speculation that the company may be an acquisition target.

Revenue in the recent period rose 2 percent from a year earlier to $731.6 million, buoyed by data-licensing sales and video advertising. Analysts on average had predicted $686.4 million, according to data compiled by Bloomberg. Net income was $91.1 million, or 12 cents a share, marking the first time the company reached profitability under generally accepted accounting principles. That compared with a loss of $167.1 million, or 23 cents, a year earlier. Profit excluding some costs was 19 cents a share, exceeding projections for 14 cents.

Back to Growth

Sales were up this quarter on a year-over-year basis for the first time since 2016

Analysts on average had estimated monthly users would rise to 333 million. Twitter said daily active users increased 12 percent from a year earlier, marking its fifth consecutive quarter of double-digit increases. The company doesn’t disclose the specific number of daily active users, arguing that showing growth is more important.
"A main part of the turnaround premise is predicated on DAU gains," said James Cakmak, an analyst at Monness Crespi Hardt & Co, who estimates that Twitter has roughly 125 million daily users. By contrast, Facebook has 1.4 billion. "Without added transparency on that front, it provides more questions than answers."
Twitter last month said it suspended 3,814 accounts linked to a Kremlin troll farm, and notified approximately 1.4 millionpeople that they interacted with Twitter accounts potentially connected to a propaganda effort by a Russian government-linked organization. In preparation for the 2018 midterm elections, Twitter said it would verify major party candidates for all statewide and federal offices, with open “lines of communication” to federal and state officials.
Bloomberg LP produces TicToc, a global breaking news service for Twitter’s site.
The company gave a first-quarter outlook for adjusted earnings before interest, taxes, depreciation and amortization of $185 million to $205 million. Analysts estimated $188.3 million.
The San Francisco-based company may stand to benefit from Facebook’s recent decision to shift its news feed toward content from family and friends and to focus less on posts from media outlets and businesses. The change is encouraging publishers and online advertisers to increase investment on Twitter, according to some analysts. Still, that may not be enough to move the needle for Twitter’s overall share of worldwide digital ad spending, which is expected to shrink slightly to 0.8 percent this year, according to researcher EMarketer. That compares with Facebook’s 18.4 percent and Google’s 31.3 percent.

The Twitter logo and stock prices are shown above the floor of the New York Stock Exchange shortly after the opening bell in New York, U.S., January 23, 2018. REUTERS/Lucas Jackson Reuters

(Reuters) - Twitter Inc reported its first quarterly net profit and topped Wall Street targets on Thursday as video ad sales rose, while a clampdown on fake accounts brought the number of people using the social network in below expectations.

Shares of the microblogging service rose about 15 percent in pre-market trading after an initial dip.

Twitter's previous inability to turn a profit had confounded investors given the company's ubiquitous presence in the media and popularity among celebrities, athletes and politicians such as U.S. President Donald Trump.

Twitter in October had signaled the breakthrough was possible as it slashed expenses. Fourth-quarter adjusted profit and revenue both topped analysts' targets.

The company said it expects "to be GAAP profitable for the full year 2018," referring to generally accepted accounting principles.

Still, Twitter missed Wall Street targets for people using the service, reporting 330 million monthly active users for the quarter, a 4 percent increase from a year earlier but flat from the third quarter.

Analysts on average had expected 332.5 million monthly active users, according to financial data and analytics firm FactSet.

The tally of users is closely watched by investors as a sign of future ad sales potential.

San Francisco-based Twitter said usage was hurt by seasonal weakness and a change that Apple Inc made to its Safari web browser that reduced the tally of users by 2 million. Twitter had warned investors about the two factors in October.

Twitter also said in a shareholder letter that it had stepped up efforts to reduce spam, automated accounts known as "bots" and fake accounts.

Monthly active users in the U.S. market, where Twitter makes most of its revenue, fell to 68 million from 69 million in the third quarter.

Chief Executive Jack Dorsey has focused for the past year on tweaking the product he co-founded to try to attract more people.

Dorsey doubled the number of characters allowed in each tweet in most languages, from 140 to 280, and tried to limit the harassment of women and minorities on the site. Twitter has also struck deals with media companies for live news and entertainment shows.

Facebook Inc has 2.1 billion monthly users, while Snapchat owner Snap Inc , which does not report a monthly figure, has 187 million daily users.

Twitter swung to a net profit of $91.1 million, or 12 cents per share, in the fourth quarter, from a loss of $167.1 million, or 23 cents per share, a year earlier.

Adjusted profit was 19 cents per share, topping analysts expectations of 14 cents per share, according to Thomson Reuters I/B/E/S.

Revenue rose 2 percent year-over-year to $731.6 million, the first increase since the fourth quarter of 2016, beating Wall Street's target of $686.1 million, according to Thomson Reuters I/B/E/S.

Twitter continued a push to diversify its sales beyond advertising. It reported $87 million from data licensing and other revenue, up 10 percent from a year earlier, while advertising revenue rose 1 percent to $644 million.

Shares in Twitter were up 47 percent over the past 12 months as of Wednesday's close, outpacing a 17 percent rise in the S&P 500 Index <.SPX>.

    The social media sector is trying to cope with a regulatory backlash in Europe and the United States over privacy, addiction to the medium, hate speech and alleged abuse of social media by Russia to sway foreign elections.

    Twitter in January said it had expanded notifications to about 1.4 million people exposed to content generated by a suspected Russian propaganda service during the 2016 U.S. elections. Moscow denies meddling.

(Reporting by David Ingram in San Francisco and Pushkala Aripaka in Bengaluru; Editing by Leslie Adler)
Twitter‬, ‪Revenue‬, ‪Earnings‬‬,DATA MANAGEMENT,COLLABORATION,CXO,TECH INDUSTRY,DIGITAL TRANSFORMATION,SMART OFFICE,