Written by CNN Staff
(CNN) — Twitter once again raised revenue forecasts Wednesday, attributing the strong showing to a stronger-than-expected advertising business.
The microblogging service said that its revenue reached $574 million during the third quarter, up 37% from the same period last year. It projected revenue of $545 million to $560 million for the fourth quarter.
Twitter’s improved fourth-quarter outlook sent its stock up $1.41, or 3.2%, to $40.54 in after-hours trading. That puts Twitter’s market value at $26.7 billion, more than Facebook and Alphabet, which combined.
The San Francisco-based company said its advertising revenue grew 40% year-over-year. Twitter ad revenue is now $541 million, the highest quarterly haul since Twitter began reporting the figure.
Twitter’s strong performance, which topped analyst estimates, comes after a string of self-inflicted stumbles. In February, CEO Jack Dorsey became permanent CEO after serving in interim capacity. Since then, Twitter has redesigned its app, added new Twitter features for high school and college students, and launched an overhauled Moments feature.
All this comes in a year when Twitter has seen its user base stall. However, Twitter’s third-quarter revenue picture was a stark contrast to the company’s user growth woes. Twitter said it had 330 million average monthly active users, a 4% jump from the same period last year, but still lower than the 340 million Twitter reported last quarter.
Twitter’s ad business benefited from a growing number of advertisers. Twitter CFO Ned Segal said that about half of the company’s revenue growth in the past year came from new advertisers and that number is expected to rise.
Analysts polled by Consensus Metrix had forecast Twitter’s third-quarter revenue at $573.9 million.
Twitter attributed the company’s improved forecast to a more stable advertising business, improved mobile ad sales, and more people using the site on personal devices instead of on desktops and laptops.
