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Twitter boss says 'not satisfied' with user growth | Twitter boss says 'not satisfied' with user growth |
(35 minutes later) | |
Twitter's revenue and earnings for the second quarter have beaten expectations, but co founder Jack Dorsey has said he is "not satisfied" with its user growth. | Twitter's revenue and earnings for the second quarter have beaten expectations, but co founder Jack Dorsey has said he is "not satisfied" with its user growth. |
The micro blogging site posted revenue of $502m, up 61% year-on-year and beating its own top forecast of $485m. | The micro blogging site posted revenue of $502m, up 61% year-on-year and beating its own top forecast of $485m. |
But active users reached 316 million in the period, up only slightly on the 308 million in the first quarter. | But active users reached 316 million in the period, up only slightly on the 308 million in the first quarter. |
Mr Dorsey said the firm had to do more to realise its full potential. | Mr Dorsey said the firm had to do more to realise its full potential. |
"We've got unbelievable brand awareness, but people are not clear why they should use it themselves," he said. | "We've got unbelievable brand awareness, but people are not clear why they should use it themselves," he said. |
The bulk of new active users came from the social network's SMS fast followers - people who sign up for text alerts but don't need a Twitter account. | The bulk of new active users came from the social network's SMS fast followers - people who sign up for text alerts but don't need a Twitter account. |
Excluding these active users rose by just 0.7% compared to the previous quarter. | Excluding these active users rose by just 0.7% compared to the previous quarter. |
'It'll take time' | 'It'll take time' |
Speaking after the results, chief financial officer Anthony Noto said the firm would start a marketing campaign aimed at addressing why people should use Twitter by the end of the year. | Speaking after the results, chief financial officer Anthony Noto said the firm would start a marketing campaign aimed at addressing why people should use Twitter by the end of the year. |
He said it would also simplify the service to make it easier to use. | He said it would also simplify the service to make it easier to use. |
But Mr Noto warned that the firm did not expect to see "sustained meaningful growth" until it reached a mass market audience, which he said would take a "considerable period of time". | But Mr Noto warned that the firm did not expect to see "sustained meaningful growth" until it reached a mass market audience, which he said would take a "considerable period of time". |
MCH analyst James Cakmak told the BBC that both Twitter executives were "extremely candid, more than any of us expected". | |
"There's clear evidence of a focus that wasn't there before. They gave comfort about their strategic direction," he added. | |
But he said the fact there was no update on the appointment of a permanent chief executive was concerning. | |
Mr Dorsey took the helm temporarily at the start of this month after previous boss Dick Costolo stepped down. | |
The change came after pressure from investors unhappy with the firm's user growth. | |
Shares fall | |
The number of Twitter users is still dwarfed by its most high-profile competitor, Facebook, which boasts 1.4 billion users. | The number of Twitter users is still dwarfed by its most high-profile competitor, Facebook, which boasts 1.4 billion users. |
And analysts remain sceptical about its long term prospects for increasing active users from its current niche user base of celebrities and journalists. | And analysts remain sceptical about its long term prospects for increasing active users from its current niche user base of celebrities and journalists. |
Investors' initial reaction to the second quarter results was positive, with shares rising over 6% in after-hours trading, before falling sharply to trade 6% lower at $34.24. | Investors' initial reaction to the second quarter results was positive, with shares rising over 6% in after-hours trading, before falling sharply to trade 6% lower at $34.24. |
Shares in the social networking site, which have fallen around 10% over the past year, are still below the $38.80 price they debuted at on the stock market in 2013. | Shares in the social networking site, which have fallen around 10% over the past year, are still below the $38.80 price they debuted at on the stock market in 2013. |
The firm, which has yet to post a profit, also reported a smaller than expected loss of $137m for the period. | The firm, which has yet to post a profit, also reported a smaller than expected loss of $137m for the period. |
Twitter said it expected full year revenue of between $2.20bn to $2.27bn, slightly higher than its previous forecast. | Twitter said it expected full year revenue of between $2.20bn to $2.27bn, slightly higher than its previous forecast. |