Twitter, the micro blogging service, disappointed on Monday with its latest quarterly report showing weaker than expected user growth and a tepid revenue forecast.
A year after its initial public offering, Twitter reported that it added 13m monthly active users in the three months through September, up 4.8%, reaching 284m users world-wide, compared with the 6.3% rate in the previous quarter.
Usage of the service by existing users has remained flat with on average, regular users accessing Twitter feeds slightly less frequently than during the previous quarter. The firm also disclosed that in its top 20 markets, fewer than half of Twitter’s monthly visitors check out the service daily.
"We had another very strong financial quarter" said Dick Costolo, CEO of Twitter. "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."
Revenue in the third quarter more than doubled to $361.3m, compared with $168.6m a year ago and the firm collected $1.77 in ad revenue per 1,000 users, its highest level ever and up 83% from last year’s third quarter.
Spending of millions of dollars on stock compensation for its growing work force resulted in a net loss that was $175.5m or 29 cents a share, compared with a loss of $64.6m, or 48 cents a share, in the period a year earlier.
Twitter forecast fourth quarter revenue of $440m to $450m and adjusted profits of $100m to $105m.
Twitter’s shares fell 10% in after-hours trading on Monday to $43.65, cutting $3bn in market value to about $26.9bn
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