Investors are disappointed as the social media giant Twitter revealed its slowest quarterly revenue growth since going public in 2013.
According to Thomson Reuters, revenue only grew 1% to £567 million, contrary to analysts’ estimate of £590 million.
Despite Chief Executive Jack Dorsey describing ‘strong growth continuing’ with regard to audience, the increase of average monthly users by 4% to 319 million is also short of analysts’ expectations.
Twitter’s net loss increased to £133 million in the fourth quarter ended December 31st, almost double the year before.
The business has attributed flagging revenue to difficulty attracting advertisers amidst fierce competition.
In a statement, Twitter goes on to warn that the struggle may continue: ‘Advertising revenue growth may be further impacted by escalating competition for digital ad spending.’
It has also been suggested that a flurry of executive departures damaged the success of the social networking site in 2016. For example, the products team had three heads within the year.
Having been the battleground of the US election campaign, investors are shocked that the ‘Trump Effect’ has done little to help.
Twitter’s Chief Operating Officer Anthony Noto has explains how Trump’s tweets certainly illustrate ‘the power of Twitter’.
However, he goes on to explain how tough it is for ‘an event or single person’ to make a major impact on business results.
Chief Executive Jack Dorsey has released a comment on the disappointing figures:
‘While revenue growth continues to lag audience growth, we are applying the same focused approach that drove audience growth to our revenue product portfolio.
‘This will take time, but we’re moving fast to show results.’
The pressure is well and truly on as investors grow impatient and rapidly lose faith in Twitter’s business model.