TWTR stock soared by as much as 17.50% in morning trade, now selling at $40.41 after Twitter Inc (NYSE:TWTR) announced its fiscal first quarter result. The social media company beat analyst estimates for revenues and also recorded a healthy growth in active users.

Strong Numbers

For many years, the social media giant had been a perennially loss-making organization with no hope of turning a corner despite having a strong and loyal user base. However, things have started to change, and in this particular quarter, the company’s monthly active user metric has been the most important factor for TWTR stock. Analysts had estimated that the monthly active user number would drop to 318.8 million in the quarter (from 321 million in the same quarter last year), but Twitter beat that estimate comfortably as the figure rose to 330 million.

Net profit during the latest quarter jumped $190.8 million, or 25 cents per share, up from a year ago profit of $61 million, or 8 cents per share. On an adjusted basis the company earned 9 cents a share, missing analysts’ projection by 6 cents.

The rise in the monthly active users also allowed the company to attract more advertising dollars and monetize those users in a far more profitable way. The quarterly revenue stood at $787 million, which reflects a rise of a whopping 18% year-over-year, topping analysts’ estimates of $776.1 million. One of the biggest factors behind the handsome rise in revenue was the money earned from advertising sales. Global advertising sales stood at $679 million, reflecting a year-on-year rise of 18%. In its key market, the United States, Twitter’s ad sales figures rose by 26%.

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Fresh Focus for TWTR Stock

The rise in the key metric of monthly active users is directly related to Twitter’s new initiative to clean up the platform from spurious accounts, and it is clear that this initiative has delivered handsomely for the social media giant. Lawmakers in different countries had urged social media platforms to clean up their act over the past year or so, and in the past, the presence of such accounts had been blamed by the company for its muted monthly active user growth.

More importantly, a cleaner platform and a higher number of active users have also made Twitter an attractive platform for advertisers.

TWTR stock is up over 42% so far in 2019.

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