You Might Love Twitter But It's Still Not Making A Penny And That's A Problem

Even the Donald can't help...

With the year that we’ve just had it’s hard to imagine how it would have unfolded had we not had Twitter at our fingertips.

Yet despite its seemingly indispensable role in our lives Twitter is still struggling to turn any of that obsession into cold hard cash.

Bloomberg via Getty Images

The company just announced a loss of around ÂŁ133m in the last three months of 2016, a considerable increase over its ÂŁ72m loss during the same period in 2015.

As the Guardian points out, this is the latest blow for a company that has now accumulated losses of reportedly around $2.8bn since it first floated on the stock market three years ago.

So what’s the problem? Well it’s certainly not the amount of people on Twitter with the company reporting an impressive 319m monthly active users.

That’s a small but still meaningful increase of four per cent year-over-year.

The problem then is making sure these 319m users are actually engaging with advertising in a way that then makes Twitter lots of money.

You see President Trump might have turned Twitter into his official mouthpiece but that doesn’t actually mean anything for the company that’s giving him that very platform.

Win McNamee via Getty Images

According to the company’s shareholder’s letter, Twitter has seen some declines in advertising revenue in the US. These declines (5% year-over-year) were unfortunately significant enough that they simply wiped out any positive growth that came from the European market.

Features like the Promoted Tweet just aren’t performing as well as they used to and the company has said it’s already looking to dramatically streamline its focus on how to turn tweets into money.

It’s a genuinely difficult situation for Twitter to be in, like Facebook it is in many ways an open platform that brands can use however they want without ever having to resort to advertising.

While you’re not going to see Twitter disappearing from your smartphone anytime soon the realities remain that this is a company that is still trying to find out how it can turn our obsession with Trump’s Twitter feed into meaningful profit.

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