Twitter Inc. (NYSE:TWTR) beat sales estimates in the third quarter of its fiscal year. Twitter reported its net loss narrowed to $21.1 million, or 3 cents a share, in the quarter. On an adjusted basis, the company reported profit of 10 cents a share, higher than analyst estimates of 7 cents.
Revenue declined 4.3 percent year-over-year to $589.6 million, but was still higher than the $587.5 million projected by analysts. The better-than-expected sales were driven by Twitter’s video advertising and data-licensing platforms. Sales in the U.S. fell 11 percent from the same period a year earlier. International sales grew 6 percent from a year earlier.
Twitter also added more monthly users in the third quarter. The company reported that monthly active users rose 4 percent to 330 million in the quarter. Twitter recently adjusted the number of monthly active users back to the fourth quarter of 2014 after determining it had incorrectly counted users of a service for third-party apps as active participants on the platform. The company said that after the change, it had 326 million users in the second quarter instead of 328 million.
Daily active users increased 14 percent, the fourth consecutive quarter of double-digit growth. Chief Executive Officer Jack Dorsey attributed the user gains to improved marketing and heightened awareness of Twitter. Twitter has emerged as U.S. President Donald Trump’s favorite communications tool.
The social network has struggled to attract new consumers and advertisers. Many investors view audience size as a measure of Twitter’s long-term health. The company has shifted its focus to videos and live events to spur audience growth. Bloomberg LP is now developing a global breaking news network for the Twitter service.
Twitter has been hampered by harassment and trolling on its platform and criticized for its role in Russian meddling to influence the 2016 U.S. presidential election. Last week, the company announced new, harsher measures to immediately and permanently suspend accounts that clearly harass or post nude images without consent. The company also recently announced measures to bring greater transparency to advertisements on its site. Those measures include exposing who paid for the ads, who they are targeted to, and how long the campaign has been running.
Twitter gave a fourth-quarter outlook for adjusted earnings of $220 million to $240 million, higher than analysts’ projected $200 million. The company’s shares surged as much as 12 percent after the release of the quarterly results.