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Twitter CFO: Expect no 'meaningful' user growth 'for a considerable amount of time'
(Reuters)
Twitter just threw cold water on investor hopes that the company is making progress expanding the size of its audience.
Twitter's user growth has stalled in recent months, and has been stagnant in the US for more than a year, but Wall Street has been hoping that new products would help revive the company's total number of monthly active users.
During the company's Q2 earnings call on Tuesday though, Twitter Finance Chief Anthony Noto basically said that the company's user growth is not expected to rebound anytime soon.
"We do not expect to see sustained meaningful growth in MAU until we start to reach the mass market. We expect that will take a considerable amount of time."
The bearish comments killed the after-hours rally in Twitter shares. The stock, which had been up as much as 6 percent after the company beat Wall Street's revenue and earnings targets, quickly reversed course and plunged 7.5 percent during the conference call.
Asked later in the call how MAU trends were faring in the third quarter, Noto said that "in the near term our organic growth is going to be very low as it was this quarter."
Twitter's total monthly active users (excluding so-called SMS followers who use Twitter on low-end cell phones) grew by a scant two million users in the April to June time period, for a total of 304 million MAUs.
Twitter is popular among celebrities, journalists and activists, but its audience is tiny compared to Facebook, which claims 1.4 billion users. Twitter's user growth in the US came to a halt during the second quarter, stalling at 66 million users (including SMS), the same number as in the first quarter of the year. All of the new users in Q2 came from international regions.
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