Saturday 24 September 2016

Twitter's growth screeches to a halt

James Titcomb

Published 12/02/2016 | 08:54

Twitter Chairman Jack Dorsey. Photo: Bloomberg
Twitter Chairman Jack Dorsey. Photo: Bloomberg

Twitter's growth stalled at the end of last year as the number of people using the service flatlined, raising yet more questions about the troubled service.

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The social network announced that monthly users had stubbornly remained at 320 million in the fourth quarter of 2015, the first time it has reported no growth in active members.

The news highlights the struggle its founder Jack Dorsey faces in turning his company around amid fears that the service has peaked.

Twitter has been struggling to live up to expectations as user numbers appear to be peaking. Its chief executive of five years Dick Costolo left last summer and Dorsey, who returned to lead the company, has so-far failed to inspire shareholders’ confidence.

Shares have slumped in the last year. They fell by more than 10 per cent immediately after last night’s results in after-hours trading but regained most of its losses after Dorsey suggested the dip was temporary.

Twitter posted revenues of $710m (£490m) in the fourth quarter, a 48 per cent increase, and a narrowing $90m loss.

However, it also said revenues in the current quarter would be lower than analysts had predicted, and excluding the small number of people that access Twitter only via text messages, the company’s users actually declined, from 307 million to 305 million.

Analysts have worried that Twitter, unlike Facebook, may be a relatively niche service that most internet users are not interested in, and the company is trying to make it easier and more appealing to novice users.

Earlier on Wednesday, Twitter announced that it would introduce a new version of its homescreen, replacing the chronologically-ordered feed of tweets that members are used to with one that displays older posts that users may have missed.

The move drew a mixed response from its loyal users, many of whom see the service’s up-to-the-minute nature as a key advantage over Facebook.

“We continued to see strong financial performance this quarter, as well as meaningful progress across our three areas of focus: ensuring more disciplined execution, simplifying our services, and better communicating the value of our platform,” Dorsey said.

In a letter to shareholders, he promised to improve the service, clamp down on the online harassment that has plagued the service, and said that user growth had returned in the first few weeks of 2016. He also reassured those who claim that Twitter is losing its intrinsic nature, stating that it would continue to focus on live conversations.

Telegraph.co.uk

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