Twitter Shares Plunge on Weak Outlook, Slowing Revenue Growth

Twitter announced that its revenue was up by only 20% to $602 million in the second quarter of the fiscal year, its smallest recorded gain and eight-consecutive period of contracting growth. The social-media company further cautioned that demand from advertisers that serve as its primary source of revenue, is weaker than predicted, dimming its outlook for the third quarter.

Twitter posted a net loss of $107.2 million or 15 cents a share against the loss of $136.7 million or 21 cents a share a year earlier. Twitter's shares plummeted by 11% to $16.39 in after-hours trading following the report, erasing gains from the prior month.

In a statement to shareholders, the social media firm has acknowledged that it is struggling to compete with other social media platforms, particularly in the advertising offerings. Twitter's CFO Anthony Noto stated in a interview that the company will venture into other areas of advertising budgets to increase demand and eventually boost revenues.

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