Twitter fails to grow its audience in second quarter of 2017

The number of active users on Twitter shows no signs of growth as revenue falls

Twitter has invested heavily into video and live-event content with little return (Reuters)

Twitter failed to attract more monthly users in the second quarter, spooking investors looking for evidence that the company is on a sustainable long-term growth path.

A long-term turnaround depends on Twitter expanding its audience. That number stands at 328 million monthly active users — the same as in the prior quarter, the San Francisco-based company said in a statement on Thursday. Revenue fell 4.7 per cent and the company’s net loss also widened, affected by a $55m (£41m) write-down of the value of its investment in SoundCloud, the German music streaming service.

Twitter is still working to prove that it can build a sustainable, growing business. After hitting a plateau with its user base and struggling with a slowdown in sales, the company started narrowing its focus, shuttering businesses and teams that didn’t fit its goal of being a destination for live-event content. With a goal of reaching profitability, Twitter began investing heavily in video, aiming to draw a more mainstream set of users and premium advertising deals. The network now has a promising set of partnerships in its pipeline, but some investors are sceptical that Twitter will ever be much bigger than it is today.

“It’s a niche platform,’’ said Brian Wieser, an analyst at Pivotal Research. “It always was and always will be.’’

Bloomberg