Twitter user growth stalls and revenues dip

Twitter shares drop 9 percent as it fails to deliver user growth

Twitter beats Wall Street expectations, but user growth has totally stagnated

Twitter did not add any new users in the second quarter. Though year-over-year revenue decline moderated and its adjusted earnings per share improved compared to its financial results in the first quarter of 2017, Twitter's important user metrics were arguably disappointing. The company earned $0.08 per share in the quarter on revenue of $573.9 million; Wall Street analysts expected the company to earn $0.05 per share on revenue of $536.6 million.

As far as engagement, Twitter said 12% more users are visiting the site daily than a year ago, but no comparison to the previous quarter was provided. This compares with a quarterly GAAP net loss of $107 million, representing a GAAP net margin of (18%) and GAAP diluted EPS of ($0.15) in the same period past year. Analysts had projected $568 million. With Twitter no longer providing quarterly sales or EPS guidance, analysts have been conservative with their forecasting. Daily active usage was up 12 percent year-over-year, the company reported.

The Twitter logo is displayed on a screen on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., September 28, 2016.

Still, Twitter isn't being to open about those DAUs, and instead doing the Very Tech Move of telling us the growth rate and giving us a chart without a Y axis when talking about its DAUs. Also: Twitter guided for Q3 adjusted EBITDA of $130 million to $150 million, below a $146 million consensus at the midpoint.

Twitter is facing competition not only from Facebook, but also messaging app Snapchat.

In a statement, both CEO Jack Dorsey and COO Anthony Noto claim that the increased user growth is a sign of Twitter's strength.

After Twitter 2Q 2017 earnings were reported, the company's stock plummeted in premarket trades, falling by as much as 9.64% to $17.72 per share.

If Twitter isn't going to grow its overall audience, at least it's growing the number of people who come back daily, which means more ad impressions (and suggests happier - or at least more addicted - users).

One of Twitter's biggest gambles to spur higher user engagement has been its increased investments in live and streaming video content.

The company has been trying to monetize the platform although advertising revenue fell 8 per cent to $489m and it lost a deal to livestream National Football League games to Amazon.

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