Twitter Grows to 199 Million Daily Active Users, Posts 28% Increase in Year Over Year Revenue in Q1

For Twitter, 2021 is a solid start as the company closed the first quarter with a total revenue of $1.04 billion up 28% year over year, reflecting strength in brand advertising in March as well as accelerating year-over-year growth in Mobile App Promotion (MAP) revenue. 

In a Q1 report released to its shareholders on April 29, 2021 the company confirmed that the platform grew its monetizable Daily Active Users (mDAU) to an average of 199 million, up 20% year over year and up 7 million sequentially. This was driven by ongoing product improvements and global conversation around current events.

Social Media Today also confirmed that Twitter made significant progress on its brand and direct response products, with updated ad formats, improved measurement, and new brand safety controls, contributing to 32% year-over-year growth in ad revenue in Q1. 

Twitter Q1 2021 – MONETIZABLE DAILY ACTIVE USERS (mDAU) 

As you can see, Twitter is growing at a steady rate – though not sure about their math skills. 162 + 38 does not equal 199. Must be a rounding error. 

In the letter issued by the company, Twitter says that its usage growth was driven by “ongoing product improvements and global conversation around current events”. 

The United States saw a growth in Monetizable Daily Active Users of 13%, while international usage rose by 22%, with Twitter still seeing solid growth in Japan, and expanded usage in India, as more Indian users continue to come online. 

Though that has also caused problems more recently, with Twitter clashing with Indian authorities over attempted censorship. Even so, the growth in both international and US markets is positive, and will help Twitter establish a more stable, ongoing business as more brands look to connect with users in different regions. 

Twitter Q1 2021 – REVENUE GROWTH 

In terms of revenue, Twitter made $1.04 billion in profit for the quarter, up 28% year over year.

According to the report, “advertiser demand was strong in the quarter, with Mobile App Promotion (MAP) revenue also rising.”

That could, however, be impacted by Apple’s IDFA update, though Twitter has been working to prepare for such, through integration with Apple’s SKAdNetwork.

“While it is still too early to understand the full impact of Apple’s iOS 14.5 changes, our integration with SKAdNetwork has allowed us to reach a new audience, increasing the total number of iOS devices to which we can advertise with MAP ads by 30% while maintaining cost-per-install performance.”

Twitter doesn’t expect the IDFA change to have a major impact for its ad partners, though like all platforms, it needs to wait and see before it can measure the impacts. That may pose a problem moving forward, but if it is, all digital ad providers will likely experience the same, which may soften market response.

The numbers look good, and point to growing evolution at the platform, though Twitter’s cost of revenue has also seen a significant jump.

Twitter Q1 2021 – RESEARCH AND DEVELOPMENT

Twitter says that research and development expenses grew 25% to $251 million, “primarily due to higher personnel-related costs as we continue to focus investments in engineering, product, design, and research”.

Twitter has been hard at work developing new product offerings, like audio Spaces and new ‘Super Follow’ options to provide financial incentive for creators. In addition to this, Twitter also acquired newsletter platform Revue, and development platform Reshuffle in the period, adding to its costs.

And it’ll be looking to spend more on development moving forward, with a range of new options, like business profiles, currently in the works, while newer tools like Communities and the expansion of topics will also require added investment.

Twitter added that it now has more than 6,100 employees worldwide, a 20% YoY jump in overall staffing. 

In looking at its key wins for the period, Twitter says that Topics has seen good take-up among new users, helping to guide them to more relevant tweet content.

“During sign-up, customers can now choose Topics to follow from a dynamic list of what’s most popular – an improvement that led to 33% of new customers following Topics during sign-up in Q1.”

Twitter says that it now has more than 7,000 Topic options, across nine languages, which it’s continually expanding, and recommending to users, as a means to boost engagement and time spent.

Second Quarter Earnings Release Details 

Twitter expects to release financial results for the second quarter of 2021 on July 22, 2021, after market close. Twitter will host a conference call on the same day to discuss these financial results at 3pm Pacific Time (6pm Eastern Time).