Twitter released its performance figures for the third quarter of 2021, showing a steady increase in both number of users and revenue. But stable may not be enough, given the platform’s ambitious growth goals, while its ongoing investment in new projects doesn’t seem to pay off as likely to be hoped for.
First, active users – Twitter’s number of daily active users that can be redeemed is now at 211 million, an increase of 13% over the previous year.
Twitter is somehow trying to cover up its data by reporting direct comparisons from the previous year, unlike the quarter-on-quarter chart, but for context, here are its mDAU figures in the second and third quarters of 2021 in parallel.
As you can see, Twitter has not added any new users in the US at all, with all 5 million of its new users coming from outside of North America. Which isn’t necessarily a bad thing, since Twitter still has a lot of potential for growth in different markets, but it can be a concern for investors, given that most of the platform’s revenue comes from U.S. users.
Again, Twitter uses a more distorted comparison compared to the previous year, as opposed to showing quarterly performance, but again, for context, Twitter generated $ 1.19 billion in revenue in the second quarter of 2021, meaning it generated an additional $ 94 million in in the third quarter, with the majority coming from the United States.
Any growth is obviously good, but it’s interesting to consider where Twitter’s usage statistics are moving relative to its growth targets, which it released back in February. As part of its Analysts Day presentation, Twitter said it aims to reach 315 million mDAUs by the fourth quarter of 2023, with revenue increasing to $ 7.5 billion that year.
So how is follow-up on Twitter?
Twitter was at 199 million mDAU in Q1 this year, rising to 206m in Q2 (+7m), and is now 211m in Q3 (+5m). To reach 315 million by 2023, it needs an annual growth rate of about 38.6 million mDAU. So, at the moment, it’s not quite on the right track, while its revenue figures will also need a significant increase for the platform to reach those values (Twitter is on track to reach $ 5.1 billion in revenue this year).
Which he needs to hit, otherwise he could face significant changes. Last year, a group of investor investors bought their way on the Twitter board to encourage the replacement of current CEO Jack Dorsey, who they believe does not maximize the platform’s capabilities. Twitter’s executive team has managed to organize a postponement of execution for Dorsey, based on these ambitious growth goals, but if Twitter can’t meet them, you can bet that those calls for Dorsey’s removal will intensify once again, which could cause a major shift in applications.
Which is also why Twitter was so eager to try new things and throw new ideas into the wall, which is, in general, a welcome change for an app that has long been criticized for lacking innovative momentum. But even so, the figures, at least for now, do not suggest that these new additions still provide any major increase in usage, with many projects either failing or failing to gain significant use at an early stage.
For example, Twitter shut down its Stories-like Fleets option in July due to a lack of user interest, its additional Twitter Blue subscription program did not provide any radical new functionality that would justify the monthly cost, despite Twitter trying to pull off ‘cancel posting’ as an alternative to the functionality of editing tweets, and the process of group tweeting in the Community seems to run counter to many of the key capabilities of the engagement platform.
Twitter, of course, is still developing these options, which is a side effect of faster launches and reruns as you go, but so far, while Twitter is definitely doing more things, we’ll just see any ‘game change’ or functionality to increase usage as a result of these experiments .
Which then brings us to Spaces, the platform’s main hope regarding the audio social trend, which is already fading in many respects.
Twitter is working to raise awareness about Spaces chats as it seeks to increase engagement with this option, while also adding Spaces themes to help display the most relevant discussions to each user.
Spaces could still become a bigger part of the tweet experience, but again, will that be enough to increase usage to the levels needed by Twitter, and reach that mark of 315 million mDAU in 2023?
Overall, the figures for Twitter are fine – revenue figures have met market expectations, and Twitter has also noted that Apple’s data privacy update hasn’t greatly affected its advertising business, which was particularly highlighted as a hurdle in Facebook and Snapchat reports .
But some key challenges remain, when looking at the overall direction of the company. This does not mean that Twitter cannot achieve these goals, nor that change is guaranteed if it does not, but the question is how much benefit the platform can bring from its various updates and whether it will be able to drive the increased adoption it needs.
This is, of course, unless it can get a big boost from e-commerce, another element of focus in the app.
Can e-commerce sales via tweet add a significant amount to the end result while increasing usage?
Friendly communicator. Music maven. Explorer. Pop culture trailblazer. Social media practitioner.