Twitter returned to revenue growth in the third quarter, with sales up 14 percent year-on-year to USD 936 million. Advertising resumed after the slow second quarter, as events restarted and delayed products were launched. User growth was somewhat slower than the previous quarter, with Twitter adding only around 1 million daily active users in the three months.
Daily users were still up 29 percent year-on-year to 187 million. That includes 20 percent annual growth in the US and 32 percent in the rest of the world.
Twitter's operating profit improved to USD 56 million from USD 44 million a year ago, while net profit dropped to USD 29 million or 4 cents per share, from USD 37 million or USD 0.05 per share in Q3 2019.
Adjusted free cash flow was a negative USD 74 million, as capex increased to USD 289 million on investment in data centre infrastructure and operating cash flow fell to USD 215 million from USD 336 million a year ago. Twitter ended the quarter with total cash of USD 7.7 billion. The company said it had not yet started the share buyback announced in March due to the market uncertainty.
Twitter said the positive ad market had continued into October but it was difficult to predict the impact of the US elections in early November. The company said it was optimistic that its recent product improvements and enlarged audience could sustain the positive results outside the election period.
Investment will continue, leading to near 20 percent growth in operating costs in Q4, compared to a 13 percent increase in the past quarter. Capex will remain over USD 250 million during the quarter.
