Not long ago, Twitter Inc (NYSE:TWTR) had a giant status right next to its rival social network firm Facebook Inc (NASDAQ:FB) but the glory seems to be fading slowly, and it’s even showing in the firm’s value.
Twitter was valued at $40 billion in 2013 when it launched its IPO. The firm was among the most successful tech companies, and investors had high hopes for its future. Three years down the line, the company’s value dropped to $10 billion thus raising questions about Twitter’s direction and where it went wrong. Recent players such as Uber appear better positioned than Twitter and investors are starting to lose hope in the company’s stock which is now at record lows.
Twitter’s problem is the lack of quarterly growth, and the rate of registering new users has drastically slowed down. The number of monthly active users has also gone down. The company registered 307 million active users in the last quarter of 2015. The number only improved by 5 million users since the first quarter of the same year.
During the recent earnings call on Wednesday, Twitter stated that the difficulty of gaining new users was attributed to the fact that it appears a bit hard for new users to get acquainted with the platform. The firm’s CEO, Jack Dorsey introduced new features such as shifting from the star rating to a heart rating like Instagram. However, the company’s fortunes have not improved despite the subtle changes.
Efforts to improve the social network have not yielded much fruit, and four senior executives have already left for greener pastures. Regardless of the unfortunate trend, the company still believes that it can turn things around and recover its status. Twitter is currently trying to come up with new ways of making the social network more appealing and easy to use especially for newly registered users. There is a high likelihood that the company will make drastic changes to get its wheels turning again.