Twitter reported Thursday stronger-than-expected profits and revenues in the third quarter, igniting a strong rally in shares of the social media giant.
The US social media giant delivered a $789 million profit, including one-time gains, compared to a net loss of $21 million in the previous year, as revenues grew 29 percent to $758 million.
Twitter shares rallied 13.6 percent in premarket trade following the results, as the markets overlooked a dip in the number of users of the microblogging site.
Average monthly active users totalled 326 million, down from 335 million in the previous quarter, a drop the company said came from efforts to weed out fake and inauthentic accounts.
The record profit included one-time gains from tax and asset valuation adjustments. Excluding those items, profits amounted to $163 million.
Twitter said the drop in its user count was a direct result of efforts to improve the “health” of its platform by removing fake and abusive accounts.
“We’re achieving meaningful progress in our efforts to make Twitter a healthier and valuable everyday service,” said chief executive Jack Dorsey.
“We’re doing a better job detecting and removing spammy and suspicious accounts at sign-up… This quarter’s strong results prove we can prioritize the long-term health of Twitter while growing the number of people who participate in public conversation.”
Twitter has managed to swing into profit over the past few quarters after years of losses, but it has struggled to grow its user base beyond a core of celebrities, journalists and political figures.
The San Francisco-based company claims its estimate of daily users, which it says reflects engagement, was up nine percent in the past quarter but offers no specific numbers.