Shares of Twitter (TWTR) were trading nearly 9% higher before market open on Thursday, following the release of the social network operator's fourth-quarter results. Its revenue during the important holiday period surpassed analysts' average forecast, and its growth in monetizable daily active users (mDAU) accelerated yet again.

"We reached a new milestone in Q4 with quarterly revenue in excess of $1 billion, reflecting steady progress on revenue product and solid performance across most major geographies, with particular strength in US advertising," said CFO Ned Segal in the earnings release.

A woman looking at her smartphone

Image source: Getty Images.

Twitter's fourth-quarter highlights


Q4 2019

Q4 2018



$1.01 billion

$908 million


Operating income

$153 million

$207 million


Monetizable daily active users

152 million

126 million


Data source: Twitter fourth-quarter shareholder letter. Table by author.

Revenue grew 11% year over year to $1.01 billion, primarily driven by a 12% increase in advertising revenue. Not only did this come in at the high end of management's guidance range of between $940 million and $1.01 billion for the period, but it marked an acceleration from its 9% revenue growth in the third quarter.

Three months ago, management said it expected that some recently discovered bugs in its legacy Mobile Application Promotion (MAP) revenue product, as well as errors in the company's personalization and data settings, would have a lingering negative impact on sales. This turned out to be true -- in the company's letter to shareholders,  management estimated that those issues held the company's revenue growth rate back by four or more percentage points during Q4. Despite that, Twitter was still able to accelerate its revenue growth.

Fortunately, management said, the company has made progress on its next-generation MAP product, which it expects to launch sometime this year. Further, Twitter "shipped remediations designed to help address the third-party measurement issues we encountered in Q3."

Operating income fell 26% year over year to $153 million, reflecting the revenue headwinds from product issues, planned headcount growth, and investment across the company's top priorities.

One particularly noteworthy figure from the report was the 21% year-over-year increase in mDAU -- an acceleration from 17% and 14% growth rates in the third and second quarters of 2019, respectively. This was the fourth consecutive quarter of accelerating mDAU growth. Management said the robust gains were broad-based, "with double-digit increases in all of our top 10 markets."

Twitter further said its strong mDAU growth was "driven by product improvements, including continued increases in relevance in the Home timeline and notifications."

Expecting more momentum in 2020

Management is optimistic about the current year.

"Entering 2020, we are building on our momentum -- learning faster, prioritizing better, shipping more and hiring remarkable talent," said CEO Jack Dorsey in the earnings release. "All of which put us in a stronger position as we address the challenges and opportunities ahead." 

Throughout 2020, management plans to continue investing in key initiatives like improving the health of the conversation on its platform, revenue durability, and the pace of product development. To support these priorities, Twitter expects to grow both its headcount and its total costs and expenses by approximately 20%.

Management guided for first-quarter revenue to be between $825 million and $885 million. At the midpoint of that range, the tech company would be delivering 9% year-over-year revenue growth.