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Twitter reports slowest quarterly revenue since going public as user growth falls flat


By Rebecca Stewart | Trends Editor

February 9, 2017 | 3 min read

Twitter has missed Wall Street estimates, posting 2016 fourth quarter earnings of $717m and noting a 14% overall revenue increase since 2015.

Twitter reports slowest quarterly revenue since going public as user growth falls flat

The social network also reported extremely sluggish user growth, upping the number of daily active users of the site from 317 million in quarter three to 319 million in Q4.

The figures mark Twitter's slowest ever quarterly revenue growth since going public, with analysts originally predicting that Twitter's revenue would rise to $740m in the final quarter of the year. Its revenue in 2015 was $710m, meaning over the course of a year the company's quarterly revenue intake has increased by just 1%.

Advertising revenue for the quarter was $638m, down slightly year-over-year with mobile ad spend accounting for 89% this.

Overall, Twitter brought in a total of $2.5bn in revenue in 2016 compared with $2.2bn the previous financial year. The company made a quarterly net loss of $167m in the last three months of 2016, compared with the loss of $103m the previous quarter.

Its share price plummeted in wake of the news, falling as much as 10% to $16.81 in premarket trading on Thursday (9 November).

The results come as the platform faces increasing competition from the likes of Facebook, Snapchat and Instagram. To set itself apart from its rivals Twitter has been looking to cement itself as the go-to platform for breaking news and trending topics.

However, its renewed 'See What's Happening' positioning looks to be a slow burner, with the social network putting its modest 7% increase in users down to events such as the three US presidential debates.

Slow user growth has been an issue for Twitter's board and investors for a well over a year now, and in comparison to newcomers like Snapchat Twitter's pace is falling flat. Earlier this week eMarkter estimated that Snapchat's UK user-base alone had jumped by 90% in 2016 and that Instagram's had been upped by 46.5% in the same time period.

Jack Dorsey, Twitter’s chief executive said 2016 was a "transformative year," for the business.

"While revenue growth continues to lag audience growth, we are applying the same focused approach that drove audience growth to our revenue product portfolio, focusing on our strengths and the real-time nature of our service. This will take time, but we're moving fast to show results," he added.

Technology Twitter Jack Dorsey

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