There is a joke that goes, a Russian ship is on the ocean, a voice comes over the radio to the controller room “Help, help, I am sinking”, the operator mistakes the man for a heavily inebriated Russian man, who is not sinking but thinking but struggling to pronounce it and he too responds in his equally heavily Russian accent, “Hello, hello, what are you sinking about?”. This is how things are crumbling around Twitter and will soon crumble underneath it.
The experts, users, and journalists keep suggesting what Twitter needs to do and the stagnant user growth proves that it is not growing but the Twitter management is not listening. In its latest fourth quarter, an important quarter for companies, Twitter continues to report unimpressive user growth but its revenue is looking great.
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Twitter released its results for the fourth quarter and fiscal year ended 31 December 2015. Though the company suffered stagnant user growth, tit recorded earnings of 16 cents per share and a revenue of US$710-million, a48% year-on-year increase.
In the previous quarter, Twitter had 320-million monthly active users, and that number has not increased in the fourth quarter. In fact, the company reported that excluding SMS fast followers, MAUs were 305 million for Q4, compared to 307 in the last quarter and mobile MAUs represent about 80% of total MAUs. Twitter’s total audience, which consists of MAUs and monthly logged-out visitors, totaled more than 800-million in Q4.
Read more: Twitter to ditch chronological timeline for algorithms [UPDATE]
“We saw a decline in monthly active usage in Q4, but we’ve already seen January monthly actives bounce back to Q3 levels,” the company said in its earning statement. “We’re confident that, with disciplined execution, this growth trend will continue over time.”
The company does not have the same high hopes for its first quarter revenue, saying that it expects between US$595-million and US$610-million in revenue for the first quarter, compared to estimates of $70 million in the fourth quarter of 2015.
Going forward, the company wants to focus on its core service and making it more intuitive, investing in live-streaming video, giving creators and influencers the best tools, investing in making Twitter safer and better supporting developers.
Read more: How has Twitter changed as a story-telling medium?
Other numbers to come out of the Q4 report is that Twitter’s advertising revenue was US$641-million, an annual increase of 48% while mobile advertising revenue was 86% of total advertising revenue. Mobile advertising revenue was 86% of total advertising revenue. International revenue totaled US$247-million, an increase of 51% year-over-year.
Though the company is making money, its stagnant and dropping MAUs are worrying. Kevin Landis, a pre IPO investor at Twitter, Facebook, SolarCity and Yelp, sums up Twitter’s problems in a CNBC interview when he says, to paraphrase, that the problem with Twitter is not even its stagnant MAUs but that when a user forgets to check Twitter on a day, do they miss it?
