Twitter Hits Revenue Targets, but Growth Continues to Slow
- Friday, February 6th, 2015
- Share this article:
Twitter disclosed its Q4 financial results yesterday, revealing that while the company beat Wall Streets profit and revenue targets, its historically fast user growth has continued to slow throughout the year.
While Twitter gained between 13m and 16m users in each of the first three quarters of 2014, it rose by only 4m in Q4, which CEO Dick Costolo attributed to the launch of iOS 8. According to Costolo, around 3m users were lost because of a change to the Shared Links feature in the mobile Safari browser, while 1m users were unable to get their passwords to work due to an encryption issue.
Year-on-year, Twitters user numbers grew 20 per cent in 2014, its slowest year yet. Costolo claimed that the first quarter of 2015 has seen numbers accelerate again, but an internal memo by Costolo obtained by The Verge showed that the company is aware that user-on-user abuse has become an increasing problem that the social network has struggled to react to.
“We suck at dealing with abuse and trolls on the platform and weve sucked at it for years,” wrote Costolo in the memo. “Its no secret and the rest of the world talks about it every day. We lose core user after core user by not addressing simple trolling issues that they face every day.
“So now were going to fix it, and Im going to take full responsibility for making sure that the people working night and day on this have the resources they need to address the issue.”
Looking at revenue results, Twitter brought in $479m (£312m) in Q4, up 97 per cent on Q4 2013 and 33 per cent on the previous quarter. Across all of 2014, the company saw revenues of $1.4bn, but still struggles to profit, with losses of $125m on the quarter and $578m on the year. However, these were improvements on last years figures, and Twitters stock rose during after-hours trading.
Twitter has announced deals with Google and Yahoo in the past week in an effort to get its tweets and ads seen by more people, and Costolo referenced that fact in the earnings call, saying, “I want to point out that our pace of execution across the company, which I noted is an area of focus in our our Q3 call is already improved and I am delighted about that and about the results I am seeing from the team.
“You already see evidence of this improvement in our recent cadence of product launched that are making Twitter better for current users, people who are new to Twitter, developers and marketers.”