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Twitter to Roll Out TV Ads During World Series; Growth Still Stalling In Q3

Twitter is finally getting serious about explaining itself to the world: The company will roll out new TV ads during the World Series game tonight, CEO Jack Dorsey announced during the company’s Q3 earnings call Tuesday. The ads are part of a new integrated marketing campaign that the company had previously announced and that soft-launched earlier this month and that also includes online video and paid search ads. Dorsey said that the company will continue throughout Q1 of 2016.

Dorsey announced the new ads as the company once again reported mixed results: Twitter’s revenue continues to grow, but its user growth is still stagnant.

Investors have been paying close attention to the latter, which was one of the main reasons behind the departure of Twitter’s former CEO Dick Costolo. Twitter on average had 307 million monthly active users with registered accounts during Q3 of 2015. That’s only a small improvement from Q2, when the company reported 304 million monthly active users with registered accounts, and not that much more than a year ago, when it had 287 million monthly actives.

The company also highlighted another number Tuesday: Including what it calls SMS fast followers, it had 320 million monthly active users on average during Q3, compared to 316 million monthly actives during the preceding quarter. Twitter started reporting monthly active users including SMS fast followers for the first time this summer. However, SMS fast followers don’t actually sign up for a full Twitter account, and don’t use any of the company’s monetized apps. Instead, they just follow one Twitter account via SMS.

What’s more, most of these SMS fast followers are coming from emerging markets that won’t matter much to Twitter’s bottom line any time soon. In the USA, on the other hand, growth has essentially flatlined, as shown in this slice of one of the company’s earnings slides:

The news was better on the revenue front: Twitter generated $569 million of GAAP revenue during the quarter, compared to $361 million during Q3 of 2014. This resulted in a net loss of $132 million, compared to a net loss of $176 million during the same quarter a year ago. None of this was a big surprise to Wall Street. Twitter released an adjusted guidance for Q3 when it laid off around eight percent of its employees earlier this month, preparing investors that the company was expecting higher revenue than previously forecast.

This was Dorsey’s first earnings call since returning to the company as permanent CEO earlier this month. It ends a busy month for the new executive, which also included a significant round of layoffs, the recruitment of a new executive chairman and the launch of a major new product: Twitter launched its much-anticipated curated news feature dubbed Moments earlier this month. Twitter executives had previously warned that new initiatives like its curated tweet selection section Moments won’t have a significant impact on the company’s metrics for some time to come.

It was also the first time for COO Adam Bain to join the call. Bain said that video in particular has seen a lot of growth on Twitter, with views up 150 times across Twitter, Vine and Periscope.

Asked about Twitter’s roadmap, Dorsey said that the company plans to make it easier to connect to communities which have thus far been congregating around shared hashtags. He also said that the company is thinking about ways to improve customer service for consumers and brands who already interact with each other on the service.

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