Twitter stock hammered again over poor earnings

Twitter stock hammered again over poor earnings

Tuesday, October 28, 2014 8:48 am


Twitter saw its shares hammered Monday after reporting quarterly results that largely met expectations but failed to allay concerns about sluggish growth of the messaging platform.

The San Francisco-based firm service posted a net loss of $175.5 million on $361.3 million in revenue in the three months that ended on September 30.

Meanwhile, the number of monthly users grew 23 percent from a year earlier to 284 million, matching expectations of analysts.

“We had another very strong financial quarter,” Twitter chief executive Dick Costolo said in a release.

“I’m confident in our ability to build the largest daily audience in the world, over time, by strengthening the core, reducing barriers to consumption and building new apps and services.”

Twitter shares fell more than 10 percent in after-market trades that followed release of the earnings figures, along with a lackluster fourth-quarter outlook.

Investors had evidently hoped to hear the ranks of users were growing faster at Twitter.

“Their user growth is mildly encouraging, but I want to see better,” said Forrester Research analyst Nate Elliott.

“Users is their key metric; they need to get people using the site every day.”

– Lagging Facebook –

The analyst lamented that the Twitter service has changed little since it launched in 2006, while social network Facebook has thrived by perpetually innovating.

“Facebook is constantly giving people new reasons to come back to the site, Twitter needs to do more of that,” Elliott said.

Twitter earlier this month said it would start reconfiguring users’ timelines with “relevant” messages from people they haven’t bothered to follow at the service.

Based on a positive response from its tests, the service is inching toward the Facebook model of using software to “curate” what users see based on their interests or activities, Twitter said in a blog post.

Twitter said the plan, which has drawn resistance from some users, remained a “timeline experiment” and might not make it to 100 percent of users.

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