Twitter’s user base wasn’t quite as big as it is tweeted about in past years. The social media network said that it is overstated its number of monthly users since 2014.it is blaming third-party applications that sent the authentication messages via texts through Twitter’s system. The company restated the number of monthly active users for three quarters.
Investors shook off the disclosure and sending Twitter shares higher in early trading. The company also reported third-quarter results that exceeded analysts’ expectations. The social media network also said it expects to achieve profitability in the fourth quarter. The stock rose $2.50 or $14.6 percent on Thursday morning.
The issue may add to credibility problems for Twitter. It is which has been under pressure to weed out fake accounts and bots. As much as 15per cent of Twitter’s user base may be bots or programs that mimic human behavior but are designed to push an idea or product. Twitter’s advertising customers want to reach real people, not bots.
Growth in Quarters:
It could also deepen investors’ concerns about Twitter’s growth. Twitter said it had 326 million monthly active users in the second quarter, not the 328 million it had previously reported. First and fourth quarter monthly active users were also trimmed by 1 to 2million. The company said it doesn’t have the data to reconcile periods before the fourth quarter but believes the overstatement is smaller.
The company said it lost $21.1 million or 3 cents a share, in the third quarter. Sales declined 4 percent to $589.6 million. Twitter also said it expects to turn a profit in the fourth quarter.
Also published on Medium.