Twitter Shares Plunge Due to Lack of User Growth

Twitter Social Music AppNearly $6.5bn was lost in extended trading yesterday, after the social media company’s first set of results showed a dramatic slowdown in user growth.

The number of people who use the social network at least once a month grew 30pc to 241m in December. However, that marked a slowdown on the 39pc year-on-year increase the previous year.

The company’s revenues more than doubled from $317m to $655m last year, accelerating faster than expected in the final quarter to $243m, up 116pc. Meanwhile, the company’s full-year losses widened from $79.4m to $645.3m, including a $511.5m loss in the final three months of 2013.

Twitter’s shares plunged 15pc on Wednesday night after the results were released. They fell even furtherto 17.7pc, after Twitter’s earnings call wiping $6.5bn off the company’s market capitalisation.

Investors have been banking on Twitter following the same sort of trajectory as Facebook, which turned 10 years old on Tuesday and has only started making serious money relatively recently.

Last year, Facebook’s annual profits jumped to $1.5bn from $53m in 2012, after the company worked out how to make money from mobile users.


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