Investors drove shares of Twitter Inc. up 29 percent in after-hours trading Tuesday after the company showed that it was gaining ground as an advertising platform with second-quarter sales that easily outpaced expectations.
Twitter’s revenues for the quarter shot up 124 percent to $312.2 million — well ahead of the $283 million analysts projected. Advertising revenues made up more than 88 percent of the total top line.
The 140-character messaging service has been working to prove to Wall Street that it can compete against larger rivals, particularly Facebook.
Dick Costolo, chief executive officer of Twitter, called out the company’s trajectory in the ad business to analysts on a conference call.
“That growth is primarily driven by higher engagement, which translates into improved [return on investment] for our marketers,” he said.
The company said its average monthly active users rose 24 percent versus a year earlier to 271 million, a slight drop off from year-over-year growth of 25 percent in the first quarter.
Still, Twitter still has some work to do when it comes to getting that consumer attention and the associated advertising clout to reverberate on its bottom line.
The tech company said its net losses for the quarter ended June 30 widened to $144.6 million, or 24 cents, from $42.2 million, or 32 cents, a year earlier. On an adjusted basis, the company logged earnings of 2 cents a share, better than the 1 cent loss Wall Street predicted.
Shares of the company gained $11.26 in after-hours trading to $49.85.