Twitter Stock Down 12% As It Posts $132m Loss
Twitter shares fell 12% on opening in New York on Wednesday after the social network's latest results disappointed investors.
Shareholders were looking for stronger user growth than the company reported in its first quarter statement following the market close on Tuesday.
Twitter, which went public on the New York Stock Exchange last November, said it had 255 million monthly users at the end of March, up 25% on a year ago, though the figure was two million lower than Wall Street's consensus.†
The social network posted a deeper net loss of $132.4m (£79m) - which compares to $27m in the same period last year - blaming †stock compensation costs.
A sharp increase in advertising revenue helped numb the pain.
Total revenue more than doubled to $250m from $114m while Twitter's advertising revenue was $226m, about 80% of which came from mobile advertising.
But it was not enough to appease investors, with shares hitting $38.35, 10% down, in Wednesday afternoon trading - still above their flotation price of $26 but down significantly on the heights seen in December of $74.73.
Analysts said user numbers was a key metric for Twitter.
The company has said it is focusing on expanding its audience and encouraging people using short messaging service to use it more often.
By comparison, Facebook has 1.28 billion users and professional networking service LinkedIn had 277 million users at the end of 2013.
WhatsApp, the messaging app Facebook has agreed to buy for $19bn, recently passed the 500 million user milestone.
"We had a very strong first quarter. Revenue growth accelerated on a year over year basis fuelled by increased engagement and user growth," Twitter's chief executive Dick Costolo†said in a statement.
Twitter gave a conservative revenue forecast for the current quarter and for all of 2014 - expecting revenue of up to $280m†for the April-June period.