Twitter might be considering subscription options as ad revenues drop

Twitter released its quarterly results this week. This shows that sales in the past quarter decreased by 19 percent compared to 2019. The company also tells investors that it is investigating the possibilities for paid subscriptions.

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Twitter shares the plans after it released its past quarter’s financial results. It showed that the company had revenues of $ 683 million in the past quarter. That is a decrease of 19 percent compared to the same period in 2019. However, the company reports a “moderate recovery” in advertiser demand compared to the last three weeks of March, when companies partially stopped advertising due to the corona crisis.

Advertising revenues declined 23 percent from the second quarter of 2019. This quarter, advertising revenues were $ 562 million. At the same time, costs rose five percent to $ 807 million, causing the company to post an operating loss of $ 124 million in the past quarter. In the second quarter of 2019, the company posted an operating profit of $ 76 million.

The company further writes that it is researching other sources of income, including paid subscriptions. In an earnings call with investors, Twitter CEO Jack Dorsey says the company has a ” very high bar” for asking consumers to pay for parts of Twitter. Dorsey says that a potential subscription service should “complement” current advertising revenue and not replace it.

Currently, Twitter has a small team investigating Twitter subscription options, Dorsey reports. The company indicates that such subscriptions are not yet expected in 2020. Twitter does write that investors may “see tests” or hear more details as work progresses. So it is not yet clear how possible Twitter subscriptions will work exactly.