Wall Street backlash for Twitter

The micro-blogging website ended the quarter to December 31 with 241 million monthly users, a rise of 30 per cent on a year earlier but down on some expectations.

The San Francisco-based company’s addition of nine million new monthly users was also a slowdown from the previous three quarters, when it was adding an average of 16 million new accounts each quarter.

It shares dipped by as much as 12 per cent in after-hours trading on Wednesday night, even though its revenues more than doubled to a bigger-than-expected 243 million US dollars (£149m) in the October to December quarter.

Losses of 511 million US dollars (£313.2m) for the period compared with 8.7 million US dollars a year earlier.

Twitter shares began trading on Wall Street in November with an initial price of 26 US dollars and have more than doubled in value since then.

It has led to concerns that the stock is expensive compared with similar stocks such as Facebook and LinkedIn, although analysts continue to back Twitter’s business model and long-term prospects.

Chief executive Dick Costolo said the site would only get better as it attempts to make it easier for people to start using the service.

He said: “Twitter finished a great year with our strongest financial quarter to date.

“We are the only platform that is public, real-time, conversational and widely distributed and I’m excited by the number of initiatives we have under way to further build upon the Twitter experience.”

Twitter’s public debut on the stock exchange was the most highly anticipated since that of Facebook in May 2012.

The company was launched seven years ago and last year named the UK as its biggest market outside America.

However one of the major challenges facing Twitter is to generate more revenues from outside America. While more than 75 per cent of users are outside the US, just 26 per cent of its revenue comes from abroad.