While total advertising revenue for the quarter was $474 million, a decrease of 11 percent year-over-year, Twitter has flagged up already that this will continue to lag audience growth in 2017. But its shares were up nearly 11 percent in pre-market trade because of the encouraging noises around the ad business.
Twitter has focused heavily on video and is doubling down on it given the success it is seeing. The company said it streamed more than 800 hours of live premium video from content partners reaching 45 million unique viewers, a 31 percent increase from the fourth quarter. It has struck partnerships with a number of organizations to boost its content, including broadcasting weekly Major League Baseball games and even the WBO Lightweight boxing world championship.
In an interview with BuzzFeed published Wednesday, Twitter Chief Operating Officer Anthony Noto said the company plans to "definitely have 24/7 (video) content on Twitter".
Another positive note in the earnings was that daily active users (DAUs) rose 14 percent year-on-year, highlighting more people engaging with the service on a daily basis, something that will help advertising, an analyst said.
"DAUs grew 14 percent and they accelerated for the fourth straight quarter and whilst revenue lags user growth, the signs are encouraging," Neil Campling, head of global technology, media and telecom research at Northern Trust Capital Markets, told CNBC by phone.
"You see accelerating user growth helping to accelerate engagement effectively. Twitter has massively simplified its advertising product portfolio, and it enables advertisers to understand return on investment metrics, at a time when the platform is growing in terms of usage. Those signs are encouraging."