After a year when the coronavirus pandemic and US presidential election helped boost Twitter’s user base to new heights, the company is now warning that things will likely slow down in 2021. The company reported 192 million monetizable daily active users (mDAU), an increase from the 187 million it reported last quarter, and up 27 percent from last year. But the surge of growth that started last spring is expected to slow in the coming year, Twitter said.
“In 2020, growth from product improvements reached an all-time high, with additional benefit from increased global conversation around COVID-19, the run-up to US elections, and other current Events,” Twitter wrote in a letter to shareholders. But 2021 will likely look very different for Twitter. (Though the company was quick to point out there was “no change to our ambition” to hit the 20 percent growth target announced last March, which helped CEO Jack Dorsey fight off a challenge from activist investors.)
We expect this will result in an average annual growth rate of ~20% from Q4’19 to Q4’21. There is no change to our ambition (announced in March of 2020) to grow mDAU at a compound annual growth rate of 20% or more from the base of 152M mDAU reported in Q4’19. $TWTR— Twitter Investor Relations (@TwitterIR) February 9, 2021
Things were a little brighter for Twitter on the revenue side, with the company reporting $1.29 billion for the quarter, an increase of 28 percent from last year. Revenue for the year was at $3.72 billion, an increase of 7 percent from 2019. Twitter, like most companies that rely on advertising, had initially struggled at the start of the coronavirus pandemic, though revenue began to recover later in the year. Twitter said that it saw a brief “dip” in ad spending around the November election, but that advertiser interest recovered in the lead-up to the holidays.
The results come after a turbulent year for Twitter. The company has had to reckon with a disinformation crisis in the wake of a global pandemic, and an unprecedented presidential election that culminated in the platform permanently banning Donald Trump. At the same time, the company has invested in new features like Fleets and Spaces. The company has also signaled that it will likely move toward subscriptions with its recent acquisition of newsletter platform Revue.