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San Francisco: Twitter reported a net loss of $537 million during the third quarter of this year after entering into a settlement of a lawsuit brought by investors in the site years ago alleging that they were misled about the slowdown in user growth.
Although revenue rose sharply due to strong advertising sales, the operating loss of the popular social network amounted to $743 million, and the company paid more than $800 million in fines to settle the lawsuit.
A lawsuit brought by investors in 2016 included accusations that people such as the site’s former chairman Dick Costolo did not reveal the full picture of the state of the company when they sold their private shares they owned in Twitter.
Investors claimed that the board members sold their shares at “artificially inflated” prices. The lawsuit was filed a year after the value of Twitter’s stock plummeted, with the company revealing a slowdown in its growth.
Despite the cost of settling the lawsuit, Twitter revealed that third-quarter revenue was $1.3 billion, an increase of 37 percent over the previous year.
The company indicated that advertising revenue reached $1.14 billion, an increase of 41 percent over the third quarter of 2020.