Could Twitter Lite Attract More Subscribers?



Twitter launches low-data app

In early April 2017, Twitter (TWTR) launched Twitter Lite, a stripped-down version of its mobile app. The data-optimized app is aimed at users in emerging markets (EEM) such as India where Internet access can be spotty, affecting access to Twitter services.

Pushing out low-data versions of popular apps is quickly gaining popularity as ad-funded companies seek growth opportunities abroad. Facebook (FB), Alphabet’s Google (GOOGL), and Microsoft (MSFT) have all come up with versions of their apps that are low on data and power consumption. These features are designed to encourage usage of the services in locations with sporadic Internet or electricity access.

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Pressure to grow subscriber base

Twitter has struggled to grow its user base and revenues, and its Twitter Lite app could draw more users to its platform. If the slimmed-down app causes more people to sign up for Twitter accounts or encourage existing subscribers to spend more time on the platform, the company could attract more advertisers to its site. 

Similarly, Twitter could encourage existing users to spend more of their marketing budgets on the site. The chart above shows Twitter’s monthly active user base trend for the last five quarters.

Downbeat top line metric

As Twitter (TWTR) reports its 1Q17 earnings on April 26, investors will be looking for progress in its subscriber base and top line figures. The company’s 4Q16 revenue of $717 million increased only 1% from a year earlier and missed the consensus estimate of $739.7 million. 

The company’s internal guidance had implied revenues of between $687 million–$787 million in 4Q16, but the reported revenues were below the midpoint of the guidance.


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