Users don’t equal revenue — especially when it comes to digital ad revenue, says Brent Thill, senior internet analyst of Jefferies, who downgraded Twitter to a “hold” versus a “buy.”

Advertising -- especially the return on media investment  -- is the real issue. And it's growing.

Thill told CNBC on Friday there are far better choices for advertisers that get ROI with Facebook or Google. Yes, they both have high global users. But even then, it’s really about revenue per user.

“Every time advertisers we speak with go back to the Twitter platform, they don’t get the ROI; [instead] they stick with the proven categories,” he says.

Thill says Twitter rivals, such as SnapChat, post better engagement numbers. In particular, Snap is just a better platform for video.

Advertisers want multiple digital media platforms as part of a healthy overall marketplace for their messaging. Analysts are still cheering for Twitter. Thill says Twitter has recently made some strong hires -- and doesn’t rule out a comeback.

Back in April, Twitter reported an 11% drop in first-quarter advertising revenue to $474 million. Overall revenue for the period declined -- a first for the social-media platform. The second-quarter results had Twitter's advertising revenue slipping another 8% to $489 million.

Here’s some good news: In the first quarter, Twitter reported monthly active users had increased by 6% over the past year to 328 million, which stayed at the same level in the second three months of the year -- a silver lining for analysts.

Regardless of that stronger business measure, Thill says investors need to take a wait-and-see approach. At Friday’s close, Twitter stock dipped 1.4% to $16.65; Snap was up 1.7% to $14.76.

For many in the digital space, it’s all about video. Estimates from eMarketer predict digital video advertising could rise to $11.7 billion next year. Video ROI metrics in the digital media space are of major importance to marketers; especially when it comes to those digital users “engaged” with their messaging.

More than the number of users, this engagement will mean a direct line to what really matters: big future digital revenue.