Twitter reported a good start to the year, with revenues up 28 percent year-on-year to USD 1.04 billion in the first quarter. The operating result was better than expected, with a profit of USD 52 million versus a loss of USD 7 million a year ago. Average daily users increased by around 7 million compared to the end of December and were up 20 percent year-on-year, reaching 199 million in March.
Twitter said it saw strength in brand advertising in March as well as accelerating year-over-year growth in Mobile App Promotion revenue. The expanded use of Topics is also helping to engage new users, and it launched Curated Categories to match advertisers to its video content.
US revenue was up 19 percent to USD 556 million, while international revenues grew 41 percent to USD 480 million. Advertising revenue increased 30 percent on a constant currency basis, and data licensing and other rose 9 percent to USD 137 million.
The company's net profit improved to USD 68 million from a loss of USD 8 million a year ago. Operating cash flow rose to USD 390 million from USD 247 million a year ago, and capex was up over the same period to USD 179 million from USD 121 million. Twitter also spent USD 162 million buying back shares during the period.
Looking ahead, Twitter said user growth may slow somewhat from Q2, after the surge last year during the pandemic. While headcount and costs are expected to grow around 25 percent this year, revenue should increase at a faster rate, assuming the impact of the pandemic continues to abate and there is no major impact from the recent changes to iOS. The company has integrated more with Apple's SKAdNetwork in preparation for the changes and said this has increased its potential iOS ad audience by 30 percent.
For Q2, Twitter forecast revenues of USD 980 million to USD 1.08 billion and an operating loss of USD 120-170 million.
