Twitter today announced financial results for its fourth quarter and fiscal year 2016. The company posted fourth quarter revenue of $717 million, an increase of 1% year-over-year. Quarterly loss was $167 million.
Average monthly active users on Twitter was 319 million for the quarter, up 4% year-over-year. Average daily active usage grew 11% year-over-year.
“2016 was a transformative year as we reset and focused on why people use Twitter: it’s the fastest way to see what’s happening and what everyone’s talking about,” said Jack Dorsey, Twitter’s CEO. “We overcame the toughest challenge for any consumer service at scale by reversing declining audience trends and re-accelerating usage.”
Dorsey admits that while user growth is perhaps acceptable, revenue growth is not. Advertising revenue totaled $638 million, down slightly year-over-year. Mobile advertising revenue was 89% of total advertising revenue. U.S. revenue totaled $440 million, a decrease of 5% year-over-year.
“While revenue growth continues to lag audience growth, we are applying the same focused approach that drove audience growth to our revenue product portfolio, focusing on our strengths and the real-time nature of our service,” he said. “This will take time, but we’re moving fast to show results.”
Total revenue for 2016 reached $2.5 billion, an increase of 14% year-over-year, though the company still lost a total of $457 million.
“Revenue growth will continue to lag audience growth due to the sales cycle, and could be further impacted by the escalating competition for digital advertising spending and our efforts to re-evaluate our revenue product feature portfolio,” noted Anthony Noto, Twitter’s COO. “We will continue to increase the value we provide advertisers by simplifying and differentiating the portfolio and improving the engagement and measurement of our products. We are confident that this path will return us to long-term revenue growth.”
Twitter shares plunged 10% on the news.