Twitter enjoyed modest growth for the fourth quarter of 2017 despite a bad investment and plans to use its new features to bolster advertising ROI.
Daily active users (DAU) grew 12 percent year over year in the fourth quarter but dropped two percent over the third quarter. Monthly active users (MAU) were 330 million.
After three straight quarters of revenue losses, Twitter finally saw revenue growth in the fourth quarter of 2017, albeit only two percent for a total of $732 million. Total revenue for the 2017 fiscal year reached $2.4 billion, a decrease of three percent year over year.
Twitter blamed its struggles on TellApart, a marketing technology company acquired in 2015. This bad investment resulted in approximate losses of $82 million year over year, according to the letter to shareholders, and fourth quarter growth would have been eight percent year over year had it not been for depreciation.
The social network isn’t giving up on performance-based marketing, however. In November, Twitter launched a new Promoted Tweet composer designed to simplify the process. Advertisers who had access to the new compose experience created 26 percent more Promoted Tweets, launched 13 percent more campaigns and spent 23 percent more on Twitter in the fourth quarter.
Twitter also doubled its character limit and increased username length during the quarter. To attract smaller businesses to the platform, Twitter began offering Promote Mode, an automation tool that promotes brand posts up to 10 times per day for $99 per month.
Emphasis was placed on ad serving optimization in the fourth quarter, which resulted in a 26 percent increase in ad engagement rates and an 18 percent increase in return for advertisers, Twitter said. Cost per engagement (CPE) declined by 42 percent year over year while overall ad engagements increased by 75 percent.
Going forward, Twitter says that its main revenue priorities are to improve core ad offerings, tap new channels of demand such as online video and add new advertising options for brands.
Like its competitors, Twitter is investing in video content to keep users tuned in. During the fourth quarter, Twitter announced approximately 22 deals and streamed approximately 1,140 live events with 60 percent of those reaching a global audience. User-generated streams also proved popular, with 28 million broadcast during the quarter across both Twitter and Periscope.
Twitter has become a hotbed for political debates and bullying and has often been accused of censorship by its users for banning Conservative-leaning accounts, with some employees reportedly admitting the practice. With brand safety a growing concern across all marketing platforms, Twitter says it will continue its efforts to make the social network safer by clarifying its policies and adding new signals to give better context around reported Tweets—although it denies any discriminatory practices.