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Twitter expects "no meaningful growth" in the near future

Twitter held its first quarter in five years without Dick Costolo at the helm, with interim CEO Jack Dorsey taking over the earnings call to reveal modest revenue earnings and flat user growth over the second quarter.

To add further caution, Twitter chief financial officer Anthony Noto said “we do not expect to see sustained meaningful growth in MAU [monthly active users] until we start to reach the mass market.”

This comment squashed any hopes of growth in the Twitter stock price, dropping from $36.56 to $32.41 in after hours trading. For early investors, that means another quarter without any gains in the market share since 2013.

Twitter has shown a lack of growth for over two years, sticking on the 250 - 300 million numbers since 2013. The microblogging platform lacks any growth in South-East Asia, where Facebook and Google are currently pushing their own products.

At least in this quarter, Twitter showed some plans to grow out its service. Dorsey, who spoke more like the CEO without the interim (opens in new tab), said the company has three focus points:

  • More disciplined product execution
  • Simplified service
  • Better communicating to new users the value of using Twitter

Dorsey has considered a few small changes to the way Twitter works (opens in new tab) that may help new users have a better experience. Right now, lots of Twitter accounts never find followers and thus never interact with the community, something the company wants to change.

Even though a simplified service could be one step in the right direction, investors have called out Twitter’s lack of other services connected to the main microblog. Facebook has Messenger, Games, Video and other secondary uses, Twitter lacks that variation.

Twitter has been working on other apps that fulfill the lack of features on the main service, like Vine and Periscope. The company held its earnings call on Periscope, to show some of the ways the video streaming service enhances communication.

Even though both Vine and Periscope are excellent apps, they lack the core integration or revenue needed to make investors happy. That is Twitter’s main beef with investors, the fact it has been two years on Wall Street and not shown any real profit or dividends to keep up with Facebook, Apple and other tech giants.

David has been a technology journalist for over six years, covering a wide range of sectors. He currently researches apps, app sectors and app markets for Business of Apps, and has written for ITProPortal, RTInsights, ReadWrite, and Digital Trends.