Twitter's CEO making big product changes, but users not wowed

Wed Feb 10, 2016 9:25pm EST
 
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By Yasmeen Abutaleb

SAN FRANCISCO (Reuters) - Since returning to Twitter Inc in July, Chief Executive, Jack Dorsey has made a handful of dramatic changes to the micro-blogging service - and promised more.

But the new features so far have been unsuccessful at doing the one thing Wall Street wants most: getting more people to use the service.

Analysts say Twitter's stock price, which has reached record lows, is unlikely to rise until the company shows significant user growth.

"They've been a public company long enough where they should have been able to increase the user base and fix a lot of the product issues to appeal to a larger audience," said Blake Harper, Topeka Capital Markets analyst.

In a letter to shareholders released Wednesday, when Twitter reported its fourth-quarter earnings, Dorsey outlined for the first time his strategy for the company's future. But the plan lacked many details about upcoming product plans and was overshadowed by flat user growth in the quarter, the first time since Twitter went public in 2013.

The anemic growth reflects an unsettling reality for Twitter: Product changes have not reignited excitement.

In October, Dorsey unveiled Moments, which aims to make it easier for users to follow major events and breaking news, but it has failed to gain traction, analysts say.

Dorsey has also experimented with changing one of Twitter's signature features, by expanding the 140-character limit.   Continued...

 
Jack Dorsey, CEO of Square and CEO of Twitter, speaks during an interview with CNBC following the IPO for Square Inc., on the floor of the New York Stock Exchange November 19, 2015.EUTERS/Lucas Jackson