eMarketer’s latest report on mobile advertising projects global mobile ad spend to increase 75% this year to $31.45 billion. Mobile advertising is expected to be a $94.9 billion market by the year 2018. Google remains the leader in the segment with a 49% market share. But as social media networks up their mobile advertising efforts, Google will see their advertising share slip. eMarketer projects Google’s share to slip to 46.8% this year while Facebook will see their market share improve from 17.5% to 21.7%. Meanwhile, social media site Twitter is also expected to report a modest increase in market share from 2.4% in 2013 to 2.6% this year. Here is an interesting infographic on the movement of the advertising shares, courtesy eMarketer.
Meanwhile, Twitter’s (NYSE: TWTR) revenues for the first quarter grew 119% over the year to $250.9 million and exceeded the Street’s projections of $237.0 million. The growth has slowed down sequentially and they registered a modest 3.2% growth over the quarter. Loss per share of $0.19 was marginally wider than previous year’s loss of $0.18 per share, but was significantly better than the market’s estimates of $0.26 per share.
Revenue growth was driven by the advertising segment which saw revenues rise 700% over the year and 28% over the quarter. Timeline views also increased 15% over the year to 156.7 billion. The contribution of mobile within advertising revenues increased from 60% a year ago to 80% during the quarter. Data licensing and other revenues improved 76% over the year to $24.4 million.
International markets contributed 28% of the quarter’s revenues and increased 183% over the year to $70.5 million.
Average monthly active users grew 25% to 255 million and mobile monthly active users grew 31% to 198 million. By region, US users increased 19% to 57 million and international users were up 27% to 198 million.
Twitter expects to end the current quarter with revenues of $270 million-$280 million, ahead of the Street’s projections of $269 million. Revenues for the year are estimated at $1.20 billion-$1.25 billion, slightly lower than the Street’s target of $1.234 billion.
Twitter’s Advertising Upgrades
Twitter’s advertising solutions have shown impressive performance. According to a report by Resolution Media, last year, Twitter’s advertising click through rates grew 4 times over the year. For the same period, Facebook saw their click through rates double. The report also reveals that as Twitter ads are integrated within trends and conversations, they are able to generate clicks at a much higher rate.
To further strengthen this revenue stream, Twitter continued to offer several new products during the quarter. Recently, they powered advertisers with the ability to create tailored audiences from email lists and customer relationship databases. They also enabled ads to target TV conversations for Spanish language television.
Twitter Improving User Experience
Twitter is also working on improving their user experience. They recently launched new features such as push notifications for Tweets. To cater to the growing Android user base, Twitter simplified the sign-up process for Android users and also integrated the user’s mobile address book with their Twitter account. Analysts also expect Twitter to release a dedicated private messaging app. Being named the Whisper mode, the new feature would be able to allow users to convert a public conversation to a private mode instead of taking the group offline.
Twitter’s stock is trading at $39.09 with a market capitalization of $22.01 billion. It touched a high of $74.73 in December last year.