Threads Surpasses 350M Monthly Users: A Growth Milestone with Mixed Monetization Prospects
4min read Meta’s Threads platform has reached a pivotal milestone, surpassing 350 million monthly active users (MAUs) in Q1 2025, adding 30 million users in just three months. This rapid expansion underscores Threads’ position as a key battleground in the social media arms race, even as its monetization potential remains uncertain. While the app’s user growth is impressive, investors must weigh its strategic significance against lingering regulatory risks and the slow rollout of ad revenue.
User Growth: A Runway for Future Ambitions
Threads’ Q1 2025 surge to 350 million MAUs marks a 267% increase from its Q1 2024 tally of 100 million users, showcasing its meteoric rise since its July 2023 launch. The platform now trails only Meta’s core apps (Facebook, Instagram) and messaging services (WhatsApp, Messenger), which collectively reported 3.43 billion daily active people (DAP) in Q1—a 6% year-over-year jump. Notably, Threads’ 30 million MAU addition in Q1 alone nearly matches the total user base of Bluesky (35 million MAUs), a decentralized competitor, and represents 58% of its Q4 growth rate.
The app’s demographics offer clues to its appeal: 57.85% of users are male, and nearly 50% are aged 18–34, signaling strong engagement with younger, male-dominated audiences. Three-quarters of users follow at least one business, hinting at untapped potential for brand partnerships. However, Threads still lags behind X (Twitter)’s 600 million MAUs, underscoring the uphill battle for market dominance.
Monetization: A Slow Burn Strategy
Despite its user growth, Threads remains a low-revenue engine for Meta. CFO Susan Li explicitly stated in Q1 earnings that ads on Threads “will not drive meaningful revenue growth in 2025”, prioritizing user engagement over immediate monetization. Advertisers can now run campaigns globally on Threads, but the platform’s ad revenue is still in “test-and-learn” mode.
The monetization strategy focuses on:
- Seamless integration: Existing Facebook/Instagram campaigns can auto-extend to Threads with a single toggle.
- Brand safety tools: Three inventory filter tiers (Expanded, Moderate, Limited) aim to reduce ad adjacency risks.
- Cost advantages: Early adopters like Wendy’s and agencies such as GroupM report low competition, offering cost-effective CPMs for now.
Challenges Ahead: Regulation and Competition
- Regulatory Risks: The EU’s Digital Markets Act (DMA) threatens Meta’s subscription model, which could force Threads to reintroduce ads in premium tiers as early as Q3 2025. This could alienate users and reduce European revenue.
- Competitor Pressure: X (Twitter) retains twice Threads’ user base, while decentralized platforms like Bluesky offer niche appeal. Threads’ algorithmic feed and Instagram integration are its strongest differentiators.
- AI Investment Diversion: Meta’s $65 billion AI infrastructure spend (including a Manhattan-sized data center) could divert resources from Threads’ growth.
Investment Takeaways: Growth vs. Profitability
- Upside: Threads’ user trajectory aligns with Meta’s vision of a “next major social app,” and its demographics could attract Gen Z advertisers. The platform’s 1 billion MAU target (within years) suggests long-term scalability.
- Downside: Regulatory headwinds and slow monetization mean Threads may not contribute meaningfully to earnings before 2027. The stock’s valuation already reflects optimism—Meta’s shares rose 21% in 2024 on broader ad revenue gains, but Threads’ impact is negligible.
Conclusion: Threads is a Growth Story, Not a Revenue Driver—Yet
Threads’ 350 million MAUs and 30 million Q1 additions are undeniably impressive, but investors should temper expectations. The platform is a strategic bet on user engagement and market share, not a profit machine. Meta’s focus on AI and core ad revenue remains its financial linchpin.
For now, Threads’ value lies in its potential to divert users from X and sustain Meta’s dominance in social media ecosystems. However, until ad revenue scales and regulatory hurdles are cleared, Threads remains a growth story for the long game—not a near-term earnings catalyst. Investors should monitor MAU trends, ad format expansions (e.g., video ads), and the EU’s DMA outcome to gauge Threads’ trajectory.
In the words of CEO Mark Zuckerberg: “AI is redefining advertising into an AI agent that delivers measurable business results at scale.” While Threads is part of that vision, patience—and a long-term horizon—are essential for investors betting on its success.
