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Thu 24 Oct 2019 03:38 PM

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Twitter slides on disappointing growth report

Twitter profit for the third quarter was $37m, a sharp drop from last year when Twitter was helped by a large tax benefit

Twitter slides on disappointing growth report

Twitter shares skidded Thursday after reporting weak growth in the past quarter resulting from glitches that made it harder to bring in advertising revenue.

Profit for the third quarter was $37 million, a sharp drop from last year when Twitter was helped by a large tax benefit.

Revenue rose nine percent from a year earlier to $824 million, well below analyst forecasts, impacted by what the company called "revenue product issues."

Shares in Twitter slid as much as 20 percent in pre-market trade on the disappointing results.

Twitter said revenue was hit by "bugs" which made it harder to deliver targeted advertising.

"In Q3, we discovered, and took steps to remediate, bugs that primarily affected our legacy Mobile Application Promotion product, impacting our ability to target ads and share data with measurement and ad partners," Twitter's investor relations team said.

Analyst Jasmine Enberg of eMarketer said the cooler growth suggests more challenges ahead for Twitter.

"The miss (on revenue) wasn't just because of tough comparisons, which were expected to dampen their revenue growth, but issues with their ad product. That could impact their performance in the all-important Q4," Enberg said.

Twitter boosted the number of "monetizable" daily active users, the new measurement used by the platform, by six million from the past quarter to 145 million.

The results highlight challenges for Twitter, which has struggled to keep pace with rival social platforms as it seeks to remove abusive content and manipulation efforts.

"We're continuing to improve relevance while testing ways to make it easier for people to find what they are looking for on Twitter," said Jack Dorsey, Twitter's chief executive.

"We also continue to make progress on health, improving our ability to proactively identify and remove abusive content, with more than 50 percent of the Tweets removed for abusive content in Q3 taken down without a bystander or first person report."