Twitter Shares Slide on Sluggish Q4 Revenue

Twitter's role as a megaphone for the US president, countless celebrities and businesses hasn't attracted regular people to the service, not in the way Facebook has, or even Instagram and Snapchat.

"We reset and focused on why people use Twitter: it's the fastest way to see what's happening and what everyone's talking about", he said.

Twitter's (TWTR) less-than-stellar fourth-quarter results not only spell trouble for the near term, but could set the struggling social media company up for a tough year ahead, several analysts wrote on Thursday morning. Notably, the fact that the company's adjusted EPS of 16 cents topped forecast by 4 cents suggests that the cost cutting measures Twitter has taken has begun to work. Overall revenue for Q4 was $717 million, an increase of just 1% YoY.

"With constant executive churn, company restructuring, scale disadvantages and operational challenges, we remain Sector Weight", Hargreaves said.

Twitter's year-over-year advertising revenue growth peaked at 129 percent in Q2 2014 and has been on a slowdown ever since. Last month, his Twitter sniping led to Mexican president Enrique Peña Nieto canceling a planned visit. "Unfortunately, it's a situation of investor indifference - everyone is used to Twitter's troubles by now". Some of that is due to the US election - the company reported record daily audiences when it streamed the presidential debates, for example - but Twitter is chalking up the bulk of the growth to product and marketing efforts, not politics.

On Thursday, Dorsey also told analysts the company is also working to make the service easier for people to use.

Twitter's fourth-quarter profit excluding certain items was $119 million, or 16 cents a share, compared with the 12 cents per share analysts estimated on average.

Twitter has said its annual net loss has fallen from $521m the year before to $457m (£364m), this is despite quarterly losses widening. At just 1% year-over-year growth, the rate is down significantly from Twitter's 8% year-over-year growth in the company's third quarter.

The lackluster sales growth was due to a decline in advertising revenue, particularly in the US where ad sales declined 7%. Average daily active usage rose 11% from a year earlier, which Twitter can tout to advertisers. The short version is that while Trump's antics on Twitter, including slamming his daughter's business partners and then retweeting his personal account over on @POTUS, it's not going to bring in masses of new users. "The whole world is watching Twitter", he said. But Twitter promised to apply "the same focused approach that drove audience growth to our revenue product portfolio".

  • Audrey Hill