Owning 3% of the company’s stock, Dorsey lost around $89 million dollars on his Twitter shares.
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Average monthly active users were up only 8 million over the past three months, not high enough for some investors, who were expecting a growth of 16 million.
“We are not satisfied with our growth in audience”, Dorsey said.
The news meant that although financial results beat analyst expectations, with revenue up 61 per cent to $502m (£321m) and losses down five per cent to $136.7m (£88m), shares in the company tumbled. Advertising revenue rose 63% to $452 million. As per the company, 88% of its advertising revenue comes through mobile, an amount nearly $398 million.
On a brighter note, Twitter reported it was about to sign its 100,000th advertiser in a universe that could ultimately be millions.
Twitter’s acting CEO, Jack Dorsey, after the resignation of Dick Costolo early this month, confirmed that they are not so happy of their growth in terms of users inspite their company’s decent revenue improvement.
While many people are familiar with Twitter, the company has not been able to convince people that they need it. Twitter also “remains too hard to use”, Mr Noto said in the call, which was broadcast on Twitter’s live-streaming service Periscope.
“We are encouraged by the recent product pace and scope at Twitter, though we note that these will take time to fully roll out and impact the ecosystem”, wrote Bob Peck, an analyst at SunTrust Robinson Humphrey, in a note.
Twitter Inc. recently announced its earnings for the 2nd quarter of this year reflecting its performance until the 30th of June. Company executives placed the blame for Twitter’s predicament on problems with the product itself and with how it’s marketed. Following the announcement on Tuesday, Twitter shares plunged as much as 9.4% in after-hours trading. In the same quarter last year, it posted a loss of US$145 million.
Wall Street took a dim view of the management’s commentary on a post-earnings call on Tuesday.
Adjusted earnings were 7 cents per share, above the 5 cents that analysts surveyed by Zacks Investment Research had expected.
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Twitter is going leaps and bounds in improving user experience by simplifying its services and improving its communication methods. At the end of 2014, there were only 42 hedge funds with $1.01 billion invested in the stock.
