For all its cultural influence, Twitter has remained limited in its ability to make money. KevinTDugan reports on whether Elon Musk can solve the company's unsolvable problem
Photo-Illustration: Intelligencer; Photos: Getty Images/Twitter The first three months of 2022 were an interregnum for Twitter: the first quarter purely in the post–Jack Dorsey era, and the only one before Elon Musk came knocking. Thursday morning’s earnings report shows that during this period, Twitter saw a slight surprise increase in users, a little less revenue than forecast, and a roughly flat stock price. It was a familiar place to be for the company.
Quarterly earnings can be more than a window into one company; they can help explain broader societal trends. Take Twitter’s user base. The metric the company uses is monetizable daily active users — basically, the addicts who will probably never leave the site. That number rose to 229 million globally, a 15 percent increase from last year, with most of the growth coming from abroad.
Part of the problem for Twitter is that making the most possible money off its users has never quite been its raison d’être. Dorsey recently said that the company is really meant to be a “public good at an open protocol level,” and decried the fact that “it has been owned by Wall Street and the ad model.” Musk has sounded some similar notes. He has said he doesn’t care about “the economics” of the company and wants to get away from the ad model.
In that context, what’s important in these quarterly numbers here isn’t that the revenue went up or that it was less than what analysts expected — it was the composition of that revenue. Last year, Twitter made 89 percent of its money from advertising, and under Agrawal, the company became even more reliant on ads to keep things afloat.
Would you pay for a Twitter subscription? Maybe some power users would, but this isn’t Raya. As long as Snap, Facebook, and TikTok remain free, there would only be more of an incentive for people to remain on those networks — especially since meme pages just screencap the most viral tweets anyway. The problem Twitter faces — converting readers into paying customers — is similar to the one faced by an industry the company helped lay waste to: newspapers.
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