Twitter posted losses of $511m in the fourth quarter of 2013, bringing its total net loss for 2013 to $645m. In its first earnings release since becoming a publicly listed company, Twitter did however beat its earnings expectations.
The company more than doubled its quarterly revenue year-on-year, taking $242.7m in Q4 2013 compared with $112.2m in the same period in 2012.
Twitter blamed the bulk of its losses for the quarter on "stock-based compensation expense", which reportedly cost the company $521m.
Despite beating earnings expectations, the company's stock price fell slightly to $65.97 at the end of trading on Wednesday, likely owing to the company's slowing active user growth. Twitter had 241 million monthly active users (MAUs) at the end of December, up only slightly from 232 million in the previous quarter. Mobile MAUs also grew to 184 million, representing 76 percent of all MAUs.
Twitter chief executive Dick Costolo attempted to quell investor fears, promising that his company would "double down" in 2014 to accelerate its user growth.
Timeline views – the metric Twitter uses to gauge the level of interest its users have – increased 26 percent year-on-year in the quarter to 148 billion. Growth slowed in that area too, but Costolo insisted that this was down to user interface improvements, which meant users could perform more interactions per timeline view.
"We are essentially increasing the value of each timeline view," he said. He added that interactions such as retweets and favourites were up 35 percent.
Costolo also said his firm sees "significant room" for increased monetisation of its products in 2014, with its self-service Twitter Ads advert-buying product due to roll out to more countries in the coming year having been introduced into the UK, Canada and Ireland in 2013.
For 2014, Twitter predicted revenues in excess of $1.1bn. With Facebook enjoying strong financial results last week, Twitter will look to prove to its investors it will not be sidelined by the social networking giant, which boasts five times as many users.
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