Twitter reported its slowest quarterly revenue growth since going public as the company continues to face intense competition from Snap Inc.’s Snapchat and Facebook’s Instagram.
The company’s shares fell as much as 10% to $16.81 in premarket trading on Thursday.
Twitter said its user base increased 4% to 319 million average monthly active users.
Analysts on average had expected 319.6 million monthly active users, according to market research firm FactSet StreetAccount.
Revenue rose just 1% to $717.2 million, missing analysts’ average estimate of $740.1 million, according to Thomson Reuters I/B/E/S. The company’s adjusted profit, however, beat sharply lowered estimates.
“While revenue growth continues to lag audience growth, we are applying the same focused approach that drove audience growth to our revenue product portfolio,” Chief Executive Jack Dorsey said in a statement. “This will take time, but we’re moving fast to show results.”
Twitter’s user growth benefited from the social media frenzy that surrounded the U.S. Presidential election as well as the growing follower base of President Donald Trump.
Trump has been using Twitter to air his views, bypassing traditional media outlets.
Twitter was abuzz with takeover chatter last year involving big names such as Salesforce.com and Walt Disney. The rumors died down due to the lack of concrete offers.
Twitter has also upgraded its offerings with several new features, including live video broadcasts from its app.
“While none of them will likely materially change Twitter’s user/usage growth, these product innovations are a positive step,” RBC Capital Markets analysts wrote in a pre-earnings note.
San Francisco-based Twitter was also hit by a string of executive departures in 2016, including in its product team, which has had three heads in less than a year.
Twitter’s net loss widened to $167.1 million, or 23 cents per share, in the fourth quarter ended Dec. 31, from $90.24 million, or 13 cents per share, a year earlier.
Restructuring charges in the latest quarter ballooned to $101.2 million from $12.9 million a year earlier.
Twitter said in October it would cut 9% of its global workforce as part of a broader restructuring.
Excluding items, the company earned 16 cents per share in the fourth quarter, beating the average estimate of a profit of 12 cents per share.