Twitter disappoints investors with a further quarter of poor results

Losses for Twitter swelled to $167 million in the fourth quarter, from $90.2 million in the year-earlier quarter, as revenue inched up 1% to $717.2 million.

That is less than half of the 215 million U.S. dollars (£171 million) in adjusted earnings reported in the fourth quarter. Revenues and user numbers both fell short of analysts’ expectations.

Despite President Donald J. Trump’s nearly daily use of Twitter to communicate with the American people, the social media giant posted its 10th consecutive quarter of lower revenue.

Part of the challenge is that while Trump’s tweets get a lot of attention, a lot of the time that content gets distributed outside of Twitter’s core platform (such as being quoted or embedded by media outlets), where Twitter can not monetize those views.

Restructuring charges in the latest quarter ballooned to $101.2 million from $12.9 million a year earlier. Its partnerships with BuzzFeed to stream the presidential election, Thursday night National Football League games and others alongside a live Twitter feed helped achieve the figures. In 2014, the company tweeted today, stock-based compensation accounted for 45 percent of Twitter’s expenses.

And if you think about it, having Bernie Sanders print out Trump’s tweets is great for the media, but it does very little for helping Twitter make actual money. “What we may not be meeting everyone’s growth expectations, there’s one thing that continues to grow and out pace our peers”.

However, in a letter to shareholders, Twitter said it expects revenue growth to “continue to lag” audience growth in 2017, partially as a result of increased competition for digital ad spending.

Over the entire year, the social network had 319 million monthly active users, which is just a four per cent growth compared to the 305 million the year before. That’s right, in a year where Twitter was in the media more than ever before, its advertising revenues decreased.

“While none of them will likely materially change Twitter’s user/usage growth, these product innovations are a positive step”, RBC Capital Markets analysts wrote in a pre-earnings note. People also spent more time hanging out on Twitter, the company said.

Chief Executive Jack Dorsey asked for patience, telling analysts on a conference call that Twitter was investing in machine learning and searching for ways to engage advertisers. The site’s average daily active usage grew 11 percent year-over-year.

Twitter is gunning for profitability, and the Fabric business was a large investment that didn’t provide value, he said.