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Twitter has been miscounting user growth since 2014. It still delivered for Wall Street.

Twitter thinks it might achieve profitability by the end of the year.

Annual Allen And Co. Investors Meeting Draws CEO's And Business Leaders To Sun Valley, Idaho Photo by Drew Angerer/Getty Images

Twitter added four million new users last quarter, in line with the kind of user growth Wall Street was expecting.

But in a weird twist, the company’s overall user base grew by just two million total users over the number it reported in Q2, not the four million users you would expect. It turns out Twitter has been incorrectly calculating its user base since 2014, and had to adjust its monthly active user total in Q2 from 328 million users down to 326 million.

The company now claims 330 million total users.

It’s a bizarre scenario in what was an otherwise modest earnings report. Twitter reported $590 million in revenue for the quarter, a decline of 4 percent year over year. That marks the third straight quarter of year-over-year revenue declines. Wall Street expected the company to generate $587 million last quarter.

One positive sign: It finally expects to turn a profit by the fourth quarter — that’s bottom line profit. It stands to reason since Twitter reported the lowest quarterly loss in Q3, about $21 million, than it has in three years.

One big reason for potential profitability: Twitter is spending much less on stock-based compensation for employees than it was a year ago. Twitter spent $101 million on stock-based compensation last quarter, down 36 percent from a year ago.

Another positive sign: Twitter’s daily active user growth was up 14 percent over last year. That’s the fourth consecutive quarter of double-digit growth, though Twitter doesn’t share its actual DAU number.

Back to Twitter’s user growth: The company claims that it has been mistakenly counting users who were using the company’s “Digits” product, a way for users to sign into third-party apps using just their phone number. That product was sold off to Google earlier this year, and even before that, using Digits didn’t mean users were using Twitter. So Twitter cut those users from their total count, hence the adjustment.

Twitter’s user growth woes date back more than two years, since before Jack Dorsey returned as CEO in 2015. The company has added an average of just three million new users per quarter over the past eight quarters, and it seems clear at this point that there isn’t a product (Moments, live video) or even a user (President Trump) who can jumpstart Twitter’s user growth.

Twitter stock is up more than 8 percent in early trading.


This article originally appeared on Recode.net.