Twitter reports $562 million advertising revenue for Q2 2020, down 23% Year-over-Year

34% Year-over-Year growth in monetizable Daily Active Usage and total revenue of $683 million

e4m by exchange4media Staff
Updated: Jul 24, 2020 7:38 AM

Twitter has reported total revenue of $683 million for the second quarter of 2020, a decrease of 19% year-over-year or 18% on a constant currency basis. The advertising revenue totalled $562 million is down 23% year-over-year or 22% on a constant currency basis.

In Q1, widespread economic disruption and a significant decrease in global advertising spend as a result of the pandemic led to a 27% decline in advertising revenue in the last three weeks of March, the report says. “We saw a gradual, moderate recovery relative to March levels throughout most of Q2, with the exception of late May to mid-June, when many brands slowed or paused spend in reaction to US civil unrest. During the last three weeks of June, advertising revenue declined 15% year over year. Demand gradually improved once brands returned after the protests subsided,” the company has further stated.

Twitter has seen a 3% year-over-year increase in total ad engagements. Data licensing and other revenue totalled stands at $121 million, an increase of 6% year-over-year with the total US revenue at $365 million, a decrease of 20% year-over-year. Its total international revenue stands at $319 million, a decrease of 18% year-over-year or 17% on a constant currency basis.

The report states Q2 costs and expenses totalled $807 million, an increase of 5% year over year. This resulted in an operating loss of $124 million and -18% operating margin, compared to operating income of $76 million or 9% operating margin in the same period of the previous year.

The company has said in the statement: “Expense growth of 5% was lower than growth in the low teens we expected at the beginning of the quarter and reflects decisions we have made to reduce spending, continued cost savings from restricted business operations, and some of the challenges of growing headcount and investing in our objectives in the current environment. As we continue to adapt our operations and improve and increase hiring, we intend to continue investing in our most important work. We believe total costs and expenses will increase 10% or more year over year in Q3.”

Average monetizable daily active users (mDAU) has been recorded as 186 million for Q2, compared to 139 million in the same period of the previous year and compared to 166 million in the previous quarter.

“Our product work is paying off, with tremendous growth in audience and engagement. We grew mDAU to 186 million, a 34% year over year increase in Q2, the highest quarterly year-over-year growth rate we’ve delivered since we began reporting mDAU growth,” said Jack Dorsey, Twitter’s CEO.

“I also want to address the security issue Twitter suffered last week. We moved quickly to address what happened, and have taken additional steps to improve resiliency against targeted social engineering attempts, implemented numerous safeguards to improve the security of our internal systems, and are working with law enforcement. We understand our responsibilities and are committed to earning the trust of all of our stakeholders with our every action, including how we address this security issue. We will continue to be transparent in sharing our learnings and remediations.”

“Revenue was $683 million in Q2, down 19% year over year, reflecting moderate recovery in advertising demand relative to the last three weeks of March. Despite the pandemic, brands have found innovative ways to join the conversation on Twitter to connect with their customers,” said Ned Segal, Twitter’s CFO.

“We have completed our ad server rebuild and are making progress accelerating our performance ads roadmap. With a larger audience and progress in ads, we are even better positioned to deliver for advertisers when the live events and product launches that bring many people and advertisers to Twitter return to our lives.”

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