Twitter reveals third straight quarterly revenue decline and massive miscounting of monthly users

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The best that can be said about Twitter’s third quarter earnings is that it appears things are getting less bad for the struggling social media platform. The company is optimistic that things may actually start to get better at some point in the not-too-distant future.

But that doesn’t mean Twitter doesn’t have a few pratfalls left in it. More on that in a second.

On Thursday, the company reported earnings that topped lowered expectations set by Wall Street analysts. Twitter said revenue was $590 million, down 4 percent year-over-year, though 3 percent of that was due to its shuttering earlier this year of TellApart. Bottom line: It lost $21 million this quarter, compared to $103 million for the same quarter one year ago.

Monthly average users rose 4 percent from a year ago to 330 million, and were up from 326 million in the previous quarter. Good news…but!

Twitter also disclosed that due to a technical error, it has been overcounting MAUs for TWO YEARS! That sound you hear is class action securities lawyers sharpening their pencils. The company lowered those MAUs by 1 to 2 million for each quarter of the past couple of years. All is good now, the company says.

There are some bright spots. Daily active users, or DAUs, were up 14 percent. Growth in video ads and live streaming events remains strong. And data licensing is also on the upswing.

One troubling note: Twitter said U.S. revenue was $332 million, a drop of 11 percent, with 5 percent of that due to TellApart. The company had more U.S. users, but that didn’t drive more revenue. Instead, Japan was where user growth and revenue growth seem to be really booming.

Investors were pleased. In early trading, the stock was up more than 13 percent to $19.52 per share.

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