Twitter today posted a rise in revenue for the first quarter despite the lingering threat of a slowdown in advertising caused by the coronavirus crisis.
The social media platform reported revenue of $808m (£646m) in the first three months of the year, up three per cent on the same period in 2019 and ahead of analysts’ forecasts.
The was spurred on by a 24 per cent growth in monetisable daily active users to 166m, as more people turned to Twitter for news and information about the pandemic.
However, the company said it would not issue guidance for the second quarter due to “unprecedented uncertainty and rapidly shifting market conditions”.
Shares initially spiked in pre-market trading, but then fell more than six per cent.
The resilient first-quarter performance mirrors similar results issued this week by Facebook and Google. However, these tech giants offered clearer signs of a recovery in advertising revenue in April.
Twitter said ad sales were 27 per cent lower in the last three weeks in March than the year before. This was despite a recovery in sales in Asia in late March as lockdowns were lifted there.
As a result of the crisis, the social media platform said it would focus its efforts on generating revenue while slashing costs and putting expansion plans on hold.
Twitter said it would seek to bring forward the release of certain ad tools this year in an effort to win business from mobile games and app makers experiencing higher demand during the pandemic.
The firm said plans to build a new data centre may be pushed back due to supply chain interruptions and the need to save cash.
Twitter added that it would scale back hiring and reduced its expense growth, which had previously been forecast at 20 per cent this year.
“We are shifting resources and priorities to increase focus on our revenue products and reduce expense growth, ensuring our resources are allocated against our most important work,” said Twitter chief financial officer Ned Segal.
“Revenue product has been elevated to our top company priority, as the current environment validates and creates even more urgency around delivering more direct response ad formats.”
The revised plans will come as a blow to Twitter boss Jack Dorsey, who survived a coup attempt by activist investor Elliott Management earlier this year.
Dorsey held onto his role, but agreed to a shake-up of the company’s board and committed to growing active users by 20 per cent this year.
“Despite the challenging economic situation, it’s encouraging to see that like Facebook and Snapchat, Twitter is also reporting a strong first quarter,” said Yuval Ben-Itzhak, chief executive of social media marketing firm Socialbakers.
“Uncertainty around how the markets will rebound means that the social media platforms are struggling to provide guidance on their future earnings. The changes in user behaviour and budget restrictions of the brands brought about by the pandemic may mean that revenue forecast models will need to be rewritten.”