Twitter Inc’s user growth stalls as sales forecast falls short of estimates

Twitter said in a filing it had 320 million average monthly active users in the quarter.

Twitter Inc. said it didn’t add new users in the fourth quarter and forecast first-quarter revenue that will fall short of analysts’ estimates, evidence the company’s struggle to make its site more accessible is affecting advertising sales growth.

Revenue in the present period is going to be US$595 million to US$610 million, the San Francisco-based social network said Wednesday inside a statement. That compared with an average analyst projection of US$627.Six million, according to data published by Bloomberg. Monthly active users were 320 million in the last three months of the year – exactly the same number the company reported within the third quarter – while analysts had estimated 324 million.

Twitter shares have dropped 35 percent this season amid deepening skepticism concerning the company’s turnaround efforts under Jack Dorsey, a co-founder who returned late last year as chief executive officer. Dorsey, who started his tenure in October with staff cuts and the appointment of a new chairman, has been rallying his teams to help make the site more accessible and helpful for following news stories and live events, but the company has so far been slow to attract a wider audience – and the potentially higher advertising spending that comes with it.

“This is the critical period for Twitter, plus they need to show more than just optimism,” said Rob Sanderson, an analyst at MKM Partners LLC. “It’s very vulnerable at this time, and particularly if we are heading right into a recessionary environment, those ad money is going to become more difficult to get – for everybody.”

The company’s shares slid around 14 per cent after the earnings report. They rose 4 percent to US$14.98 at the near the coast Ny, bringing the decline for the past year to 68 percent.


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