Today, Mashable posted a story on Twitter announcing its first earning since becoming a public company in 2013. Twitter announced that since Q3 of 2013, Twitter has only gained one million more American users. Along with only 8 million more international users in the same time frame, this news has caused investors to become concerned about the company.
73% of Twitter’s ad revenue comes from the United States. In the past two years, Twitter’s percentage of American users was 25. Now after this recent report, it is down to only 22%. Twitter’s stock rating, according to Sterne Agee, went from “neutral” to “underperform” after the news. People on Wall Street apparently agreed, as Twitter’s stock dropped about 25%.
Marketers, however, are not as worried about the news. Jesse Pujji, CEO of Ampush, counters the news perfectly. “I think it would be a mistake for advertisers, Wall Street, humankind to look at one quarter and say ‘Oh my God, this is not what we thought it was.'” He continues, “That happened with Facebook and a lot of people lost a lot of money, and a lot of people made a lot of money and realized that it was just the beginning and really early.”
As can be seen in the graphic above, Twitter’s revenue in 2013 was more than double what it was in 2012. So, even though there hasn’t been a huge increase in new users, Twitter and its advertisers are figuring out how to maximize revenue with a stagnant amount of users. Also, 54 million users is still a very large number of people and a great opportunity for advertisers to take advantage of. Twitter, in my opinion, is still in its early stages, and it will be a couple years before we see companies taking full advantage of the advertising potential on Twitter. In a couple years, companies will have no choice but to advertise on Twitter like they do on Google and Facebook.