How Much Revenue Can Twitter Generate From Passive Users?

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TWTR: Twitter logo
TWTR
Twitter

Twitter (NYSE:TWTR) has struggled to grow its monthly active user base over the last year, with relatively lackluster performance in both the U.S. and international markets. However, Twitter stated in its full year 2015 earnings call earlier this year that its platform had a total audience of over 800 million users across the world. This translates to about 495 (800-305) million passive users who currently don’t help generate any revenue for Twitter.

In this note, we estimate the revenue potential from passive users for Twitter in 2016. We assume that a passive user will generate about 50% of the average revenue currently generated by an active user for Twitter.

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Notes:

1) The purpose of these analyses is to help readers focus on a few important things. We hope such lean communication sparks thinking, and encourages readers to comment and ask questions on the comment section, or email content@trefis.com
2) Figures mentioned are approximate values to help our readers remember the key concepts more intuitively. For precise figures, please refer to our complete analysis for Twitter

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