Thread by @TwitterIR

Twitter Q2’18 shareholder letter is now available. Read: sec.gov/cgi-bin/browse… #TWTR

Twitter Q2’18 earnings Q&A with @jack & @nedsegal at 8am ET / 5am PT. Listen via @TwitterIR or investor.twitterinc.com/events.cfm #TWTR

Tweet us your questions during our Q2’18 earnings call @TwitterIR using #TWTR

Our forward-looking Tweets are subject to risks and uncertainties. Actual results may differ materially. In addition to our Tweets, read our earnings materials and SEC filings for complete results and GAAP/non-GAAP reconciliation.
investor.twitterinc.com #TWTR

Strong revenue growth of 24% y/y reflects continued momentum w/ advertisers driven by ongoing improvements to the service + improved advertiser ROI. We’re also maintaining profitability while investing in the business, w/ GAAP net income of $100M + GAAP net margin of 14%. #TWTR

Q2 revenue: $711M, +24% y/y (+27% y/y excluding ~$14M from fully-deprecated TellApart product); GAAP net income: $100M w/ 14% net margin; adj EBITDA: $265M w/ 37% margin; net cash from operating activities: $321M vs $190M in Q2’17; adj. FCF: $127M vs. $113M in Q2’17. #TWTR

Q2 advertising revenue was $601M, +23% y/y or 21% on a constant currency basis. O&O advertising revenue was $564M, +29% y/y. #TWTR

We saw strength across Video Website Cards, Video App Cards, In-Stream Video Ads, and Website Click Cards. Video ads continue to account for more than half of ad revenue and remained our fastest-growing ad format in Q2. #TWTR

Q2 data licensing and other revenue totaled $109M, +29% y/y mostly driven by strength in Data and Enterprise Solution (DES). #TWTR

Going forward our revenue priorities include: 1) Ensuring advertisers reach audiences on Twitter when they are most receptive. #TWTR

2) Building trust w/ customers by leading in quality, transparency, and accountability. #TWTR

3) Nurturing newer channels of demand, such as online video, and continuing to grow revenue from the long tail of advertisers already on Twitter. #TWTR

4) Growing DES through our product and channel segmented go-to-market approach. #TWTR

As we look ahead to the remainder of the year, we remain optimistic about our ability to execute on our priorities and deliver value for advertisers on our platform. #TWTR

Q2 marked our third consecutive quarter of GAAP profitability with net
income of $100M, net margin of 14%, and diluted EPS of $0.13. #TWTR

Adjusted EBITDA for Q2 was $265M, or 37% of total revenue. #TWTR

We continue to expect full year adjusted EBITDA margin expansion in 2018 due to the significant margin expansion we delivered in the first half of the year. #TWTR

As we continue to grow our headcount toward our year-end target of 10-
15%, we expect our operating expense base to continue to grow in Q3 and
again in Q4. #TWTR

We launched a scalable new event infrastructure that makes it easier for people to follow events, topics + interests on Twitter, w/ the World Cup serving as its debut. Overall product improvements, organic growth + marketing continue to drive healthy DAU growth of 11% y/y. #TWTR

In Q2, we expanded “Happening Now” beyond sports to include Tweets and videos about breaking news at the top of people’s timelines. #TWTR

These experiences for major events feature timelines that include a recap, latest Tweets, top commentary, and live video, and are now more accessible across the service, including in search results and the Explore tab. #TWTR

In addition, we rolled out new, interest-based notifications, and began experimenting with organizing the Explore tab by topic to make it easier to see what’s happening. #TWTR

In Q2, we continued to invest in the performance of our video infrastructure, improving the quality of the video experience on Twitter while increasing reach and engagement for content owners. #TWTR

We signed 50 new live-streaming, highlight, Amplify and VOD agreements in Q2, including ~30 from international markets. #TWTR

DAU grew 11% y/y in Q2, with double-digit growth in five out of our top 10 global markets, demonstrating another quarter of broad-based growth. #TWTR

Average MAUs were 335M for Q2, an increase of 9M y/y and -1M q/q, reflecting impact from decisions we have made to prioritize the health of the platform, to not move to paid SMS carrier relationships in certain markets and, to a lesser extent, GDPR. #TWTR

We continue to invest in improving the health of the public conversation on Twitter, making the service better by integrating new behavioral signals to remove spammy + suspicious accts. + continuing to prioritize the long term health of the platform over near-term metrics. #TWTR

We also acquired Smyte, a company that specializes in spam prevention, safety and security. #TWTR

In Q2 we made updates to reduce the visibility of suspicious accts. in Tweet + acct. metrics to ensure malicious actors aren’t able to artificially boost an acct’s. credibility, + we announced updates to require new accts. to confirm either an email address or phone number. #TWTR

We’re continuing to improve our systems, and our ability to detect malicious automation, spam, and fake accounts has improved significantly. #TWTR

We are proud of the tangible improvements people are seeing on Twitter. We believe Twitter's value as a daily utility is enhanced when the conversation on the platform is healthy and people feel safe expressing themselves freely and openly. #TWTR

Our efforts to improve the health of Twitter impact our disclosed metrics in two ways: 1) Our work sometimes includes the removal of accounts, some of which are included in our metrics. #TWTR

2) We are making active decisions to prioritize health initiatives over near-term product improvements that may drive more usage of Twitter as a daily utility. #TWTR

This prioritization impacts growth in the near term, but we are confident that this is in the best long-term interest of the platform and will enable long-term growth as we improve the health of the public conversation on Twitter. #TWTR

As a result of our health work, decisions not to renew or move to paid
SMS carrier relationships in certain markets, and our decision to allocate
resources towards GDPR and health, MAU could decline on a sequential
basis in Q3. #TWTR

Based on our current level of visibility, we expect the decline to
be mid-single-digit millions of MAU. As a reminder, DAU growth continues
to be the best measure of our success in driving the use of Twitter as a
daily utility. #TWTR

Outlook for Q3: adj EBITDA to be between $215M and $235M, adj EBITDA margin to be between 33% and 34%; SBC expense to be in the range of $85M and $90M. #TWTR

Outlook for FY’18: SBC expense to be in the range of $300M to $350M; capital expenditures to be between $450M and $500M. #TWTR