User base grew modestly to 310m monthly active users from 305m
Jack Dorsey said firm 'remains focused on improving our service'
Twitter reportedlower-than-expected revenue for the first quarter, hurt byweaker than expected spending by big advertisers, and themicroblogging service forecast current-quarter revenue wellbelow analysts' expectations.
Twitter shares plunged 12.3 percent to $15.58 in extendedtrading on Tuesday.
Twitter's user base grew modestly to 310 million monthlyactive users in the quarter ended March 31 from 305 million inthe fourth quarter, above analysts' expectations.
Yet investorswere disappointed by Twitter's revenue miss since outlining aturnaround plan.
'It's obvious Twitter is having trouble,' said ArvindBhatia, analyst with CRT Capital.
'It's not growing anywhereclose to where people expected a while back.'
Twitter has struggled with stagnant user growth as itscomplicated interface makes it less attractive to new users.
As part of its turnaround plan, the company has emphasizedits live offerings, including live commentary and videostreaming through its Periscope app, to attract new users.
However, it blamed advertisers for the slump.
'Revenue came in at the low end of our guidance range because brand marketers did not increase spend as quickly as expected in the first quarter.
'We see a clear opportunity to increase our share of brand budgets over time.'
witter faces fierce competition from Facebook, which hasrecently ramped up its live video product, Facebook Live.
Twitter said it was optimistic that its new productofferings, including a refined algorithmic timeline and livevideo improvements, would continue to attract new users andimprove engagement on the site.
'Twitter is an iconic service and a globally recognized brand,' it said in a letter to shareholders.
'We remain focused on continuously improving our service to make it fast, simple, and easy to use.
'Relentlessly refining Twitter will enable more people to get more out of Twitter faster.'
'We remain focused on improving our service to make it fast,simple and easy to use,' Chief Executive Jack Dorsey said in astatement.
The company forecast revenue of $590 million to $610 millionfor the second quarter. Analysts on average were expecting$677.57 million, according to Thomson Reuters I/B/E/S.
First-quarter revenue rose 36 percent from a year earlier to$594.5 million, but widely missed the average analyst estimateof $607.8 million.
Its net loss narrowed to $79.7.million, or 12 cents pershare, from $162.4 million, or 25 cents per share, a yearearlier.
Excluding items, Twitter earned 15 cents per share, beatingthe average estimate of 10 cents.
'Twitter's problem is that the management does not understand what they have,' said Wedbush Securities analyst Michael Pachter, who argued that the company is still failing to retool itself for new users.
Calling the service 'horribly complicated,' Pachter rattled off a series of his own Twitter issues, even though he considers himself a power user.
For example, he just got an email telling him how to 'mute' people he follows. (Muting someone means you won't see their tweets in your timeline, although you still follow them. It's like a brush-off without the awkwardness.)
'I didn't know you could mute somebody,' he said. 'How did I not know that?'
Another frequent complaint involves Twitter's somewhat arcane 140-character limit, a relic of its early technology.
To get around the limits, users have taken to posting screenshots of longer blocks of text.
Dorsey has hinted at expanding that limit, even tweeting a 1,325-character message — as a screenshot — on the subject back in January.
So far, the limit remains unchanged.
Then there's the Twitter lingo, from hashtags to 'at' symbols and the like.
If Twitter wants to attract more grandmothers, it'll have to lose the text-speak.
Pachter called Twitter a 'great product' that has gotten to where it is in spite of, not because of its management.
The users that have stuck around — all 310 million of them — have overcame obstacles such as poor interface, search and, he said, a 'terrible functionality.'