Twitter Inc: Promised Better Future Helps Costolo Escape Critics

Twitter Inc: Promised Better Future Helps Costolo Escape Critics
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Twitter’s forward-looking statement and its fourth quarter revenue were welcomed by investors

Twitter promised an acceleration in its growth rate, which helped push the company’s stock price up on Thursday, but the current good picture shown by the company will only give a short breather to Chief Executive Dick Costolo, says a report from Reuters citing analysts.

Twitter expect better time ahead

The Twitter CEO has been subjected to a number of criticisms recently by Wall Street with analysts and investors cautious about the slow growth of the company and exits of high profile executives. During the conference call with analysts on Thursday, Costolo reiterated that Twitter has inked a deal with search engine Google. The partnership, according to Costolo, will be helpful in expanding its service to a wider segment of the public.

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Costolo exhibited his devotion and determination on enhancing their products and the consumer experience, believes JMP Securities analyst Ronald Josey. Twitter stated on Thursday that the latest products and partnership have positioned the company to accelerate its user growth. The company’s forward-looking statement and its fourth quarter revenue were better than the analysts had forecast and were welcomed by investors.

“The stock is going to be up, because it’s probably better than what people expected. But now they have to deliver,” said Wedbush Securities analyst Shyam Patil. The analyst further said one should not rely on the commentary and that the upcoming numbers will reveal it all.

iOS 8 bug blamed for slow user growth

The micro-blogging site has faced a tough time this past year in increasing the number of users on its service, which raised doubts about how it can perform parallel to Facebook, which has 1.39 billion users, or even compete with fast-growing messaging and photo apps such as WhatsApp and Instagram.

Twitter posted an acute drop in user growth for the last three months of 2014, adding only a marginal 4 million monthly users totaling to 288 million users. Twitter blamed an iOS 8 bug for the sluggish user growth. However, executives did mention that they expect user growth to pick up again in the first quarter.

On Thursday, Twitter closed up 1.33% at $41.26, while in the pre-market trade, the stock was up by over 8% to $44.71.

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