Twitter reduced its losses and slowed the decline in revenues in the third quarter, while announcing that it previously overstated its user numbers. Revenue fell 4 percent year-on-year to USD 590 million, compared to a 5 percent fall in Q2 and the company's earlier warning of no expected improvement in H2.
Twitter said it saw strength across video and direct response ad formats as well as strong performance in data and enterprise solutions. The net loss narrowed to USD 21 million from USD 103 million a year ago thanks to a sharp reduction in operating costs, and adjusted EBITDA rose to USD 207 million from USD 181 million, much better than Twitter's forecast. The EBITDA margin reached a new record of 35 percent.
For the fourth quarter, Twitter expects to maintain its margin at 35-36 percent, with an adjusted EBITDA of USD 220-240 million. At the high end of the forecast - which Twitter usually meets or exceeds - the company should be profitable on a GAAP basis, it said. This is in line with its target issued last year to turn a profit in 2017.
The company said it had 330 million average monthly users during the quarter, up 4 percent from a year ago and more than the 326 million in the previous quarter. This excludes a reduction of 1-2 million users previously included that should not have been, as they were through third-party apps. Average daily users were unaffected by the restatement and grew 14 percent year-over-year, better than the 12 percent increase in the previous quarter.
