Twitter disappoints investors as user growth hits wall
By Lehar Maan and Yasmeen Abutaleb
(Reuters) - Twitter Inc (TWTR.N: Quote) reported its first quarter with no growth in users since it went public, stoking fresh concerns on how long it will take for the company to reverse the trend.
The stalled growth in the average number of active monthly users came despite a series of changes to make Twitter easier and more engaging.
While the company said it is taking additional steps - including launching changes to the timeline of tweets earlier Wednesday - it told investors not to expect immediate results.
"Our work will take time" before the company can create long-term shareholder value, said Executive Chairman Omid Kordestani on a call with analysts.
Twitter shares fell in after-hours trading as its revenue forecast for the current quarter missed analysts' expectations. They were down 2.5 percent after a call with analysts ended.
The company's share price has declined more than 50 percent since Jack Dorsey, one of the founders, returned to Twitter in July. They closed up 4 percent at $14.98 in regular trade.
"The platform's overall growth is underwhelming," said Randy Giusto, vice president and lead analyst with Outsell, a research and advisory firm. "They have plateaued and can't look to India or China as those markets are dominated by messaging apps like WhatsApp, as well as Apple and Google's proprietary, pre-installed platforms."
The microblogging service forecast first-quarter revenue of between $595 million and $610 million, well below the average analyst estimate of $627.1 million, according to Thomson Reuters I/B/E/S. Continued...