Twitter reported that its daily active users grew 34% to 186 million in Q2 2020 compared to the previous year.
However, revenues of $683 million did not meet analyst expectations. Advertising accounted for $562 million of its revenues, which highlights just how vital ad sales are to Twitter’s business.
Ad sales were down 23% compared to a year ago, largely due to Covid-19 related losses and more marketers pausing their campaigns.
In the US alone, the company noted a 25% drop in advertising spending due to the lockdowns.
“Twitter’s second quarter results underscore the power of the platform in keeping people informed and connected around the world. With monetizable daily active users up 34% year-on year, it’s clear Twitter holds an increasingly prominent place in the lives of consumers,” said Aaron Goldman, CMO at 4C Insights.
“Revenue was down 23% due to the impact of the pandemic on advertising budgets and general hesitancy of brands to run promotions during a period of heightened attention on racial injustice. Looking ahead, with the return of sports and other live events, we expect Twitter to play an elevated role in the media mix. For brands, the key to success is creating multi-screen synchronicity as part of an omnichannel advertising strategy.”
The figures are testament to how tightly connected advertisers and audiences are, but it also adds to wider woes about an economic ripple on effect of the coronavirus pandemic.
Twitter also recently faced a massive security breach. CEO Jack Dorsey said in a statement:
“We moved quickly to address what happened, and have taken additional steps to improve resiliency against targeted social engineering attempts, implemented numerous safeguards to improve the security of our internal systems, and are working with law enforcement.
We understand our responsibilities and are committed to earning the trust of all of our stakeholders with our every action, including how we address this security issue. We will continue to be transparent in sharing our learnings and remediations.”