Facebook, Twitter showcase improvement in sentiments in Q3 2021 as revenue streams diversify, says GlobalData

Social media giants Facebook and Twitter witnessed a sentiment growth of 2% and 18%, respectively, in Q3 2021* compared to Q2 2021, each driven by positivity around revenue stream diversification (Facebook’s metaverse and Twitter’s new subscription mode) and quarterly performance, according to the Filing Analytics platform by GlobalData, a leading data and analytics company.

In Facebook’s earnings transcript released in Q3 2021, ‘Ads’ was the keyword with the most mentions. Yet, Facebook hopes to diversify revenues via its futuristic ‘metaverse’ of digital products and services. As identified by GlobalData’s Filings Analytics platform, virtual and augmented reality were the top themes for the past three quarters. However, in Q3 2021, that trend shifted, with artificial intelligence (AI) having more mentions in Facebook’s transcript. The company is focusing on AI and machine learning investments to monetize its Reels and Stories features.

Rinaldo Pereira, Business Fundamentals Analyst at GlobalData, comments: “Facebook’s comments around its metaverse were largely neutral. What is more, at the beginning of the year ‘iOS’ keywords were rarely mentioned in Facebook’s past transcripts. However, it appears that the social media giant is concerned about the future impacts of Apple’s updates to tracking on the iOS as mentions related to this rose in Q2 and Q3 2021.”

In comparison, Twitter had a slightly higher sentiment score in Q3 2021, driven by positivity around revenue growth due to the rising advertiser demand. The company, however, had fewer mentions of ‘Ads’ and related keywords compared to Facebook. Twitter’s sentiments were also driven by positivity around its focus on new features, such as audio chat and Tip Jar, coupled with the introduction of its subscription service to diversify revenue streams.

Pereira adds: “Twitter also discussed the lower-than-expected impact from Apple’s tracking updates, and statements mentioning ‘iOS’ had a higher average sentiment score compared to Facebook. The launch of Twitter’s subscription service looks to be a promising move to diversify its revenue streams. However, unlike YouTube Premium, neither Twitter nor Facebook have any ads-free offerings.”

* Indicates quarter for release of earnings transcripts and not company-specific fiscal quarters

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