Twitter Inc reported on Thursday performance above expectations even as the social media company signed up users at a slower rate during the fourth quarter.
The company said it added 4 million new users to a total 288 million monthly active customers in the three months ended December 31, or 1.4% higher compared to the fourth quarter of 2013, marking a company record for the smallest user growth in a quarter and also the first time Twitter added less users than Facebook.
Twitter has been trying to catch up to the worlds largest social media, but slowing user growth has interfered with the companys plans to reach Facebooks 1.39 billion monthly active users.
Additionally, Facebook-owned Instagram, a photo-sharing application, recently announced it had reached in 300 million in monthly users.
However, the company suggested that the decline in growth was a one-time thing as it projected the first three months of 2015 to mirror user growth in the first three quarter of last year, when Twitter stated 13 million to 16 million net additions in each period.
Company executives also explained the weaker user growth with the release of Apples new operating system iOS 8, which reflected in 4 million less users for Twitter in the quarter.
Chief Executive Dick Costolo also said Twitter is losing core users due to online harassment and outlined that the company is aware and looking to address the problem.
For the quarter Twitter reported revenue of $479 million, or almost doubled compared with the $243 million it stated in the previous year. The figure also surpassed expectations of $453.1 million complied by a Thomson Reuters survey. Twitter generated $1.4 billion in sales during 2014.
Net loss for the quarter stood at $125 million, or $0.20 per share, significantly better than negative result of $511, or $0.96 per share, in the fourth quarter quarter of 2013, when the company went public. For 2014 Twitter stated a net loss of $578 million.
Excluding some items, the companys per-share earnings stood at $0.12 for the quarter and $0.14 for the year. The figures compare with expectations of $0.06 and $0.09, respectively.
For the first quarter of 2015, the company projected revenue to land between $440 million to $450 million, while full-year sales to range between $2.3 billion to $2.35 billion. In comparison analysts had projected the company to report $449.7 million for Q1 and $2.3 billion in 2015.
“We closed out the year with our business advancing at a great pace,” said Mr. Costolo.
Twitter gained 1.33% on Thursday and closed at $41.26 in New York, marking a one-year decrease of 37.46%. The company is valued at $26.18 billion. On Friday the stock climbed 8.43% to $44.74 during pre-market trading.
According to the Financial Times, the 33 analysts offering 12-month price targets for Twitter have a median target of $49.00, with a high estimate of $64.00 and a low estimate of $28.00. The median estimate represents a 18.76% increase from the last closing price.
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