Twitter shares nosedived Tuesday after a quarterly update showed little change in its user base and the messaging platform delivered weaker-than-expected revenue growth.
The company posted a loss for the first quarter of 2016 of $80 million, compared with a loss of $162 million in the same period a year ago. Revenues meanwhile jumped 36 percent year-over-year to $595 million.
But in a key metric in the fast-evolving social media world, Twitter’s trend was flat. The number of monthly active users was 310 million, up three percent from a year ago and only slightly higher than the 305 million in the previous quarter.
Twitter changed the way it measures active users, no longer counting those who follow via SMS text messaging. The number reported in the fourth quarter including that group was 320 million.
Twitter shares skidded 12 percent at $15.64 in after-hours trading, extending their slump over the past two years.
Since its much-anticipated public offering in November 2013 at $26, Twitter shares saw a jump to $60 the following month but have been sliding since then.
Twitter’s growth woes have led to the return of co-founder Jack Dorsey as chief executive, and he has promised new services in a bid to boost growth and user engagement.
“As we outlined last quarter, we’re focused on what Twitter does best — live,” Dorsey said in a statement.
“Twitter has always been the best place to see what’s happening now. Whether it’s breaking news, entertainment, sports, or everyday topics, only Twitter lets you connect with people anywhere in the world with live conversation.”
Dorsey added that “we made a lot of progress on product innovation this quarter, particularly with live video and our refined timeline, and people love it… We remain focused on improving our service to make it fast, simple and easy to use.”
Dorsey has introduced a new “Moments” feature highlighting breaking news stories, and has been allowing users to see an “algorithmic” timeline that is designed to be better adapted to each person sending a tweet.
Twitter marked its 10th birthday last month, having become a powerful communication tool but still struggling to win users and reach profitability.
While Twitter has become a must-have tool for journalists, activists and celebrities, it has struggled to show it can expand beyond its devoted base to become a mainstream hit.
Chief financial officer Anthony Noto said the quarter “saw a return to sequential growth in monthly active usage, driven by seasonality and marketing initiatives.”
But Twitter noted in a letter to shareholders that revenue was “at the low end of our guidance range because brand marketers did not increase spend as quickly as expected in the first quarter.”