Twitter swung to $66 million net profit in the second quarter, compared with a $1.38 billion loss during the same period a year ago as the company's revenue grew the most since 2014.
The company’s total revenue surged 74 per cent year on year to $1.19bn, exceeding analysts' estimate of $1.07bn.
The average number of users who can view ads reached 206 million, an almost 10.7 per cent annual rise from the second quarter a year earlier. But it was almost 200,000 less than what was forecast by analysts polled by StreetAccount.
Revenue from the US market totalled $653m, an annual increase of 79 per cent, while international sales were $537m, up by almost 70 per cent.
Advertising revenue surged and the number of daily active users who can view advertisements grew 11 per cent,. Ad revenue was about $2m less than the previous quarter, which ended on March 31.
“As we enter the second half of 2021, we are shipping more, learning faster and hiring remarkable talent," said Jack Dorsey, chief executive of the microblogging site based in San Francisco.
"There's a tremendous opportunity to get the whole world to use Twitter."
Advertising sales for the second quarter surged 87 per cent from the same period a year ago to $1.05bn.
Total ad engagements increased 32 per cent yearly and cost for each engagement soared almost 42 per cent annually, the company said without disclosing the exact numbers.
Twitter’s revenue from data licensing and other streams totalled $137m, an increase of 13 per cent year on year.
The costs and expenses in the April-June period totalled $1.16bn, an increase of 21 per cent on an annual basis.
This resulted in an operating income of $30m against a loss of $274m in the same period last year.
“We delivered better-than-expected performance across all major products and geographies while growing our audience,” said Ned Segal, Twitter's chief financial officer.
“We continued to make significant progress on our direct response and brand products with updated ad formats, improved measurement and better prediction.
"We are driving more value for advertisers with our strong push into performance-based advertising and expanded offerings for small and medium-sized businesses."
Net cash provided by operating activities in the quarter was $382m, compared to $201m in the same period last year.
Capital expenditure in the quarter rose more than 70 per cent to $276m, driven by infrastructure investments in data centres to support audience growth and product innovation.
In its guidance for the current quarter ending on September 30, Twitter expects to earn revenue between of $1.2bn and $1.3bn.
“We continue to expect total revenue to grow faster than expenses in 2021," the company said.
"We now expect headcount, along with total costs and expenses, to grow 30 per cent or more for the full year of 2021 with a focus on engineering and product."
Twitter’s spending on research and development grew 39 per cent to $300m in the quarter. It was primarily focused on engineering, product design and research.
The company ended the quarter with about $8.61bn in cash, cash equivalents and marketable securities.
It also bought back almost $334m of stock during the second quarter through its share repurchase programme announced last year, bringing the company’s total repurchase to $746m to date.
“Our pace in future quarters may vary based on the operating environment, our capital needs and market conditions,” the company said in a letter to its shareholders.