It’s not often a company sees its share price rise despite reporting a fall in revenue. But that’s what happened to Twitter last week.

On Wednesday, the social network company reported Q1 2017 revenue down 24% on the prior year – and yet, Twitter’s share price is up nearly 20% at time of writing.

What’s behind the contrasting trends? For one, Twitter’s net loss improved after cutting costs.

But BTIG media and technology analyst Rich Greenfield puts Twitter’s improved Wall Street performance down to a simple algorithm change the company made more than a year ago – to stuff users’ timelines with less-new but nonetheless interesting tweets; to undo its traditional reverse-chronological timeline.

“That change has enabled users to find more value in the service,” Greenfield tells Beet.TV in this video interview. “It’s no longer just what happened a minute ago – it’s ‘what how you not seen since you used the service last that you should see?’

“That small change has been monumental in terms of re-accelerating user growth, because now Twitter becomes a lot more useful. You’re not just going on and being baffled about what to look at or why your’e seeing these recent tweets; you’re seeing things that are of interest to you, the consumer. And so, usage is going up.”

Specifically, Twitter’s Q1 2017 monthly-active-user (MAU) count of 328 million was 6% higher than the prior year’s quarter – not a stellar jump but positive momentum for a company that has struggled to show forward traction since bowing on Wall Street in 2013. Bear in mind that Twitter’s share price is still some 58% below its IPO price, even after this week’s gains.

Twitter’s MAU dipped slightly in Q4 2015, after which it made the algorithm change in February 2016. Since then, MAU has continued growing. But the real needle the change has moved is domestic MAU, which had flatlined before the tweak.

“There aren’t many media companies that have started their descent, in terms of usage, and reversed (it),” Greenfield says. “Twitter is in the middle of a recovery that has never been seen before in digital, online media. It presents a significant opportunity on the stock side… usage is growing double-digits. As eyeballs follow … advertisers ultimately will follow.”

All the same, Twitter’s Q1 2017 advertising revenue was 11% down from the prior year.

From a glass-half-full investor’s perspective, the company’s headroom seems clear, and its advertising outlook may improve as TV and video deals flow in.

The firm has just signed a new deal with Bloomberg, already a major supplier of live programming through its Bloomberg TV simulcast on Twitter, to launch a new streaming service, and Greenfield says video is “a significant opportunity” for the company.

In Q1, Twitter reported it streamed 77mn hours of live Periscope video and seems set to go after higher video CPMs. Whilst sales of classical Promoted Tweets are in decline, video ad sales on Twitter are growing and cost per engagement is falling, reflecting the greater place video ad engagements play in the ad mix.

We interviewed him earlier today at the MediaLink kick-off breakfast for the Digital Content NewFronts.

This video is part of Beet.TV’s coverage of the IAB’s Digital Content NewFronts 2017. The series is sponsored by the IAB. For more videos from the the #NewFronts, please visit this page