Twitter to increase headcount by 20% as it cracks US$1bn quarterly revenue

Twitter’s 4,800 employee count will grow by at least 20% in 2020, it said, as it looks to improve its offering to both advertisers and consumers.

The news comes as the company announced revenue for the three months to 31 December, 2019 surpassed US$1bn.

Revenue for the fourth quarter of 2019 was up 11%, with Twitter noting a particular strength in US advertising.

In Q4 of 2018, US$791m of Twitter’s US$909m revenue came from advertising (87%), while in the same quarter in 2019, it was US$885m of US$1.007bn (88%). The remaining revenue is categorised as ‘data licensing and other revenue’.

Twitter’s financials for 2019 (Click to enlarge)

Twitter also said its average monetisable daily active usage (MDAU) was up to 152m for Q4, up 21% year-on-year.

A lot of its success for the quarter, Twitter said was due to steady progress on its two most significant revenue product initiatives: rebuilding its core ad server and creating its next-generation Mobile Application Promotion (MAP) product.

“In combination, these two initiatives will solidify our existing ad products and position Twitter to provide more direct response ad formats over time,” a letter to shareholders said. “We also believe we have a significant opportunity to help consumers benefit from a more personalised experience on Twitter, providing them with highly relevant content across both organic and promoted content,” it said.

Twitter said ad engagements increased 29% over the final quarter of 2019, due to increased impressions driven by audience growth and improved click-through rates. Cost per engagement decreased 13%, it said, reflecting the continued shift to video ad formats and like-for-like price decreases across most ad formats.

For the 2019 calendar year, Twitter had total revenue of US$3.46bn, an increase of 14%, or 15% on a constant currency basis. Advertising revenue grew 14%, spearheaded by 21% growth in the US.

It suffered from a 19% increase in costs and expenses, up to US$3.09bn, which it said was expected.

“We delivered a solid year of revenue growth in 2019 while continuing to invest. Accelerating audience growth and our increasingly differentiated value proposition for advertisers underscores the progress we’ve made as well as the significant opportunity ahead,” the company said.

In addition, and similar to fellow social media giant Facebook, Twitter spruiked its efforts in cleaning up its integrity and content offering.

“We continued to make progress on health. In Q4, we increased our efforts to protect the integrity of election-related conversations and proactively limit the visibility of unhealthy content on Twitter, resulting in a 27% decline in bystander reports on Tweets that violate our terms of service,” the letter to shareholders claimed.

In its results last week, Facebook’s founder and CEO Mark Zuckerberg promoted his company’s efforts and progress on privacy and foreign election interference.

“There will still be debate about what kinds of political speech should be allowed, especially as the 2020 elections heat up, but by any objective measure our efforts on election integrity have made a lot of progress,” he said.

He did, however, reiterate his stance that the onus was not on him and his company to fix the problem.

“When it comes to these important social issues, I don’t think private companies should be making so many important decisions by themselves. I don’t think each service should individually decide what content or advertising is allowed during elections, or what content is harmful overall. There should be a more democratic process for determining these rules and regulations. For these issues, it’s not enough to make principled decisions – the decisions also need to be seen as legitimate and reflecting what the community wants. That’s why I’ve called for clearer regulation for our industry. And until we get clearer rules or establish other mechanisms of governance, I expect we and our whole industry will continue to face a very high level of scrutiny,” he said.

Twitter also said content was now more relevant to users.

“In Q4, we continued to improve our machine-learning models to provide more relevant content in people’s Home timelines and notifications, which contributed to 21% MDAU growth, and 15% growth in the US,” the shareholder letter said.

“We are also making it easier for people to find what they are looking for when they come to Twitter by better organising content around topics and events, and making it easier to follow and join conversations.

Twitter boasted about its media and brand partnerships

“In Q4, we made it easier to fund the best content on Twitter by allowing people to follow Topics, not just accounts.”

Twitter also boasted about its growing brand and media partnerships, which expand its content and revenue opportunities.

“We continue to enhance the public conversation around events on Twitter with live and on-demand video content, including short videos and highlights, across sports, entertainment, news and politics. This content improves the conversation on Twitter, expands the audience, and often creates additional ad revenue for Twitter and our partners.

“Recent examples include the National Basketball Association (NBA) and Turner Sports, bringing more live and on-demand NBA content to Twitter than ever before, and our partnership with [the US’] ABC and the Academy of Motion Picture Arts and Sciences to live-stream the ‘Oscars All Access’ official red-carpet pre-show.”

The company now boasts 4,800 employees, and said it is expecting to grow headcount by at least 20% in 2020, especially in engineering, product, design and research.

Jack Dorsey, Twitter’s CEO, was optimistic about the year ahead.

“Entering 2020, we are building on our momentum – learning faster, prioritising better, shipping more and hiring remarkable talent. All of which put us in a stronger position as we address the challenges and opportunities ahead.”


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