Tesla CEO Elon Musk questioned the company’s method of measuring its user base, which it uniquely calls “monetizable daily active users” on Sunday, after cancelling the $44 billion Twitter deal due to the presence of fake/spam accounts (mDAUs).
In 2019, Twitter used the term “mDAU” for the first time, stating that monetizable DAU and its associated growth “are the best ways to measure our success.”
Monetizable DAU are users who log in and access Twitter on any given day via twitter.com or our ad-capable Twitter apps.
Twitter claims that its mDAUs are not comparable to current disclosures from other companies, many of which use a broader metric that includes people who do not see advertisements.
A follower asked Musk: “$TWTR changed what it considers an active user and how it counts them about 3 years ago. @Twitter developed a proprietary method (mDAU) that’s not based on any standardised industry methodology. Since then, the number of active users has been steadily increasing”.
Musk replied: “Odd” and “Indeed”.
“What I’m seeing is that after 3 consecutive quarters of negative growth, @Twitter decided to concoct a new way to count active users that fortuitously unearthed positive growth,” said Alex who is a physics engineer and follows Musk.
Despite a $270 million net loss in the second quarter, Twitter said it reached 237.8 million users in April-June this year, a significant increase (up 16.6 percent compared to Q2 of the previous year) (Q2).
The company’s goal, according to them, was “not to disclose the largest daily active user number we could”.
“We want to align our external stakeholders around one metric that reflects our goal of delivering value to people on Twitter every day and monetizing that usage.”
From 2019, the company began disclosing the absolute number of average mDAU (previously known as DAU) for both the US and international markets.
“Advertisers come to Twitter because we have one of the most valuable audiences when they are most receptive, and we generate a high return on investment against their campaign objectives whether they are launching a new product or connecting with what’s happening on Twitter,” according to the micro-blogging platform.
When Musk backed out of the $44 billion Twitter acquisition deal, the microblogging platform announced that it is suspending over 1 million spam accounts every day.
The new figure was a doubling of the previous update.
Twitter CEO Parag Agarwal stated in May that spam account suspensions were occurring at a rate of 500,000 per day.