Twitter misses revenue estimates, shares plunge

The company posted a net loss of $79.7 million compared with a year-earlier loss of $162.4 million

Twitter shares fell sharply about 12% on Tuesday after the micro-blogging website - which managed to add 5 million people to take its monthly active user base to 310 million - missed the first quarter revenue estimates.

The company posted $595 million revenue in the first quarter ending March 31. It was up 36% from $435.9 million in the same quarter last year but missed the $607.9 million expected on average among analysts, Forbes reported.

Twitter posted a net loss of $79.7 million compared with a year-earlier loss of $162.4 million.

Twitter CEO Jack Dorsey said that "we remain focused on improving our service to make it fast, simple and easy to use".

Twitter has predicted revenue for the second quarter between $590 million and $610 million -- much lower than the $678 million analysts expected.

"Revenue came in at the low end of our guidance range, as brand marketers did not increase spend as quickly as expected in Q1," the company tweeted.

According to Dorsey, the engagement on Twitter is growing. Direct messages are up about 50% year-over-year and tweets shared via direct message are up more than 75% quarter-over-quarter.

Twitter said more than 800 million people visit the site and there are more than 1 billion monthly unique visitors to pages that syndicate Twitter content.

The company also said that new follows on the service are up about 48%.

"We've seen increases in tweets and replies and retweets and also likes. We want to continue to make sure we are refining that timeline and making it better and better," Dorsey was quoted as saying.

According to him, Twitter's brand advertising waned in the first quarter.

Dorsey hinted that Twitter's deal with the National Football League (NFL) to stream 10 games this fall will help the company earn better traffic.

Twitter's stock has fallen over 20% this year amid sluggish growth.