Tomahawk, WI 02/07/2014 (BasicsMedia) – Twitter Inc (NYSE:TWTR) announced its maiden earnings as a public company after launch of its Initial Public Offer (IPO) in November last year on Wednesday after bell. Though the company managed to register revenues exceeding market expectations but it posted a net loss for the quarter and its user growth in the quarter was also disappointing leading to a plunge in the stock of the company by around 25% on Thursday after the fourth quarter financial results were made public.

Twitter disappoints  

Twitter Inc (NYSE:TWTR) has reported revenue earnings of $242.7 million exceeding analysts’ estimation of $217.82 million and its earnings per share was $0.02 (non-GAAP) more than market prediction that twitter would lose two cents per share however the company reported a Net loss of $511.5 million compared with $8.7 million a year earlier which is more than double of analysts’ projections of $253.5 million loss. The problem area for Twitter was its user growth which almost seems to have reached a plateau position in this quarter and is the main reason behind the fall in its stock value which has lead to erosion of Twitter’s market value by about $9.8 billion. Though Twitter Inc (NYSE:TWTR) has reported an average of 241 million monthly active users (MAUs) as of 31 December, 2013 up 30% year over year, and the company also declared an average of 184 million mobile users in the fourth quarter of 2013, an increase of 37% but its user base growth has slowed over the last quarter giving a cause of worry to its investors because if its core user base cannot be sustained then it shall create a question mark on Twitter’s ability to drive future revenue growths.

Twitter’s plans

For Twitter Inc (NYSE:TWTR) up until last year it had no reason to worry about user base growth because of many mass movements which were initiated on Twitter making it a phenomenon in itself and it found many users from biggest celebrities to common users however over the last quarter due to lack of innovations and complacency on the part of its management to make attractive changes to Twitter user interface, the company has faced a fall in its user base and the timeline view on Twitter which measures the usage of Twitter by its users has noted a major decline. A word for advice for Twitter Inc (NYSE:TWTR) is pay more attention from improving on scratch then on useless research and development which seems to be heading nowhere!

DISCLAIMER: This content is neither an offer nor recommendation to buy or sell any security. We hold no investment licenses and are thus neither licensed nor qualified to provide investment advice. The content in this report or email is not provided to any individual with a view toward their individual circumstances. While all information is believed to be reliable, it is not guaranteed by us to be accurate. Individuals should assume that all information contained in our newsletter is not trustworthy unless verified by their own independent research. Also, because events and circumstances frequently do not occur as expected, there will likely be differences between the any predictions and actual results. Always consult a real licensed investment professional before making any investment decision. Be extremely careful, investing in securities carries a high degree of risk; you may likely lose some or all of the investment.