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Twitter Profit Dropped in Quarter Jack Dorsey Resigned as CEO

Revenue rose 22% on increased ad sales, average users

Twitter posted a fourth-quarter 2021 profit of $182 million, which was down from $222 million in the comparable period in the previous year. While revenue rose 22% on stronger ad sales, a 35% increase in quarterly costs (to $1.40 billion) wiped out any potential for net income growth.

Takes money to make money, we suppose. And Twitter is making money — or at least increasing its value — early this morning. After revealing its Q4 earnings, which included strong user growth, shares in the social media company jumped 7% in pre-market trading.

Ultimately, Twitter posted fourth-quarter earnings per share (EPS) of 21 cents (33 cents non-GAAP) on $1.57 billion in revenue. That revenue number was about in line with Wall Street’s forecasts ($1.58 billion), but the EPS number was lower than the 35 cents media analysts expected to see.

The social media platform reported having 217 million average monetizable DAU (daily active users), an increase of six million users from the prior quarter. That’s up from 192 million average monetizable DAUs in the fourth quarter of 2020.

What else happened in Q4 2021? Well, founder Jack Dorsey stepped down as Twitter CEO at the end of November.

“Our strong 2021 performance positions us to improve execution and deliver on our 2023 goals,” Parag Agrawal, Twitter’s new CEO, said in a statement accompanying the company’s financials. “We are more focused and better organized to deliver improved personalization and selection for our audience, partners, and advertisers.”

“Twitter had a solid fourth quarter to finish 2021, with over $5 billion in annual revenue, up 37% for the year,” Ned Segal, Twitter’s CFO, added. “There are no changes to our goals of 315 million average mDAU in Q4 2023 and $7.5 billion or more revenue in 2023. Our increased focus on performance ads and the SMB opportunity after the sale of MoPub positions us even better for 2022 and beyond.”

Twitter stock (TWTR) closed Wednesday at $37.88 per share. The U.S. stock markets officially reopen at 9:30 a.m. ET for the regular trading day.

Dorsey Agrawal and other Twitter executives will host a conference call at 8 a.m. ET to discuss the quarter and full year in greater detail.