Twitter Stock Falls 12% As Ad Spend Declines
Twitter has reported a return to user growth but its shares fell up to 12% in after-hours trading after its first quarter results showed that spending by advertisers had declined.
The social network platform’s revenue for the three months to March rose 36% on a year earlier to $594.5m but that figure was at the bottom end of its previous guidance.
Twitter said it had 310 million average monthly active users at the end of the period, compared with 305 million in the fourth quarter when numbers were actually down.
Nevertheless, it represented a typically flat performance for the loss-making company, which also produced revenue guidance for its second quarter that missed analysts’ estimates.
Twitter’s turnaround plan has included an emphasis on live offerings including commentary and video streaming through its Periscope app in a bid to attract new users.
For its decade-long existence it has struggled to make money.
Earlier this month, it announced it had won the rights to stream Thursday night NFL games in a move seen as a risky departure for a service criticised for its basic user experience.
Amid fierce competition from rivals – especially Facebook – it has moved to address the concerns and bolster engagement by confirming it will allow the sending of direct messages between anyone, removing the need for a person to be ‘following’ the sender.
It has also pledged to improve its interface – seen as complicated compared to Facebook’s.
“We remain focused on improving our service to make it fast, simple and easy to use,” chief executive Jack Dorsey said in the results statement.