Twitter CEO Dick Costolo doesn’t think the company has a problem introducing people to its platform. Instead, he said Tuesday that Twitter’s mission is getting those who are already know it to spend more time logged into the site.
That’s good news and bad news for the company’s potential user growth, which has kept Wall Street pessimistic about Twitter since its previous quarterly earnings report in February. On one hand, it means that the company is already a known quantity among potential users, but it also means that Twitter’s existence alone hasn’t been enough to draw new users in.
This chart from Business Insider shows part of the problem, with global monthly active user growth falling below 40 percent. The company added 14 million active users during the first quarter, up 5.8 percent from the previous quarter, for a total of 255 million users.
Here’s a closer look at the Twitter challenge in a chart from Statista:
So, what’s Twitter’s value proposition, especially as Facebook continues to try and lure more discussions of news over to its platform, and companies like WhatsApp build massive user bases around personal messaging?
The way Costolo sees it, Twitter’s flexibility is its greatest strength. No matter what’s going on, Twitter will be there for users with up-to-the-minute conversations.
“We think of Twitter as this companion experience for what’s happening in your world,” Costolo said.
That may be enough to entice new users to join. Twitter’s monthly active user growth has accelerated quarter-over-quarter, and the company is working on changes to its products in order to make them more appealing to people who aren’t necessarily familiar with the way Twitter works. But given the tenor of comments from analysts, it’s clear that the company needs to produce user growth, and it needs to do so quickly.
Tuesday’s announcement that Twitter had an average of 255 million monthly active users in the past quarter was at the low end of analysts’ projections, and sent the company’s stock tumbling more than 11 percent in after-hours trading to an all-time low. The stock is down five percent in the past year, and now has a market value just shy of $25 billion.
