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Twitter Disappoints Investors with Weaker than Expected Growth

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Twitter's shares slumped to below the price they were sold at when the company was listed on the stock market as it reported slower than expected growth in its user base.

Although the company grew its active customer based by 5.8% over the past three months to 255 million users, that was still below most analyst expectation.

The company posted revenues of USD250 million, of which USD226 million was advertising income, which was above expectations.

The company however reported a decline in its CPM advertising rate, which came in at US$1.44 per thousand timeline views, against US$1.49 during the previous quarter. That actually chimes in with other online businesses who are seeing a general decline in per-advert payments.

Twitter also posted a net loss of USD132 million for the quarter, although underlying profit, after excluding some costs, broke even on an adjusted basis.

Despite the improving revenues, the company's shares dropped by 11 percent in after hours trading, ending below the US$38.80 that they were sold at during the stock market listing.

The company also confirmed that it is experimenting with new ideas to ensure that new customers who sign up for the service find it easier to use, which has apparently been a significant problem once the product emerged from a techie service into the mainstream.

Rumours that it might scrap the @ and # symbols though are bound to provoke howls of protest from its core user base if carried out.

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