Twitter‘s finance chief Anthony Noto said the company did not expect to see “sustained, meaningful growth” of its user base until it reached the mass market. Adjusted earnings came in at 7 cents per share, beating expectations of 4 cents.
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For comparison, Facebook has nearly three times as many active users as Twitter, and still grew by 17 percent in Q1.
“We are not satisfied with our growth in audience”, Dorsey said.
The success story was even bigger for Facebook’s mobile ad business, where revenue rose 62 percent to $2.9 billion. Advertising revenue totaled $452m, an increase of 63% year-over-year.
After reporting the slowest average users growth, Twitter Inc.’s shares are down by more than 11 percent in extended trade on Tuesday. Meanwhile, Twitter’s stock is now up by 5.3% to $36.54. For short-term investors, the reminder of what Twitter’s facing was reason enough to run for the exit.
Twitter is also in the middle of a management transformation after Chief Executive Dick Costolo abruptly revealed his resignation in June.
“People around the globe know of Twitter, but it’s not clear why they should use Twitter“, Dorsey said during a second-quarter earnings call with investors.
The company posts $502m revenue in Q2.
Twitter just threw cold water on investor hopes that the company is making progress expanding the size of its audience.
Twitter Inc. recently announced its earnings for the 2nd quarter of this year reflecting its performance until the 30th of June.
Shares in the company fell by as much as 13 percent in after-hours trading.
The micro blogging site reported a loss of $136.7m, or 21 cents a share, narrowing from the $144.6m, or 24 cents a share, loss posted a year earlier. This surpassed the $481.28 million in revenue analysts surveyed by Thomson Reuters expected the company to report.
Dorsey declined to comment on his own potential interest in the CEO job or on the CEO search in general during the conference call, telling an inquiring analyst that the company had no update to provide at this time.
Twitter is trying to improve user experience through the simplification of its service and by improving communications. Twitter reported user growth of 2.61% to 316 million.
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According to an RBC Capital Markets analyst, Mark Mahaney, MAUs is the most important metric of the company.
