Last year, Twitter executives set ambitious goals for their company, with hopes of attracting more than 100 million new users and doubling revenue by 2023. However, the last three months of 2021 showed the challenges the company must overcome before it is can achieve objectives.
Twitter said Thursday that revenue in the last quarter of 2021 grew slower than analysts had expected, and the company predicted it would report a loss in the current quarter. But it added new users, potentially allaying concerns that it was struggling to generate interest in an increasingly diverse social media market.
Twitter reported revenue of $1.56 billion in the last three months of 2021, up 22 percent from a year earlier, but lower than analysts’ expectations. Twitter said it earned $176 million in revenue, down 34 percent from the same period a year ago. The company said it had 217 million daily active users who saw ads, an increase of 13 percent.
Twitter also announced that the board had authorized a $4 billion buyback of its shares. The company plans to buy back $2 billion of its shares on what it described as an accelerated timeline, with the remaining $2 billion to be bought over time. The plan follows an earlier $2 billion buyback that was approved in 2020, although $819 million of that program went unspent.
“It represents confidence in our strategy and execution,” said Ned Segal, Twitter’s chief financial officer, of the share buyback plan. “We put our money where our mouth is.”
Twitter has said it plans to grow rapidly over the next two years, reaching 315 million daily active users and $7.5 billion in annual revenue by the end of 2023.
The company added one million daily active users in the United States and five million users internationally in the fourth quarter. Total revenue in 2021 was $5.08 billion, up 37 percent from the prior year.
Twitter’s stock price fluctuated wildly last week when Facebook’s parent company, Meta, said Apple’s privacy changes had dampened its advertising activity. Investors viewed Meta’s earnings report as a gauge of the social media industry, but Twitter said Apple’s privacy changes had minimal impact on its advertising activities.
“Our strong performance for 2021 positions us to improve execution and meet our 2023 targets,” said Parag Agrawal, Twitter’s new CEO, in a statement. “We are more focused and organized to deliver enhanced personalization and selection for our audience, partners and advertisers.”