Stagnant user numbers kept social network Twitter from meeting investors' and users' expectations. The micro-blogging site saw its share price fall nearly 7 percent in after-market trading.
The social network's revenue forecast failed to please investors and the poor performance is likely to lead to questions about the ability of CEO Jack Dorsey to turn around the company, which listed in 2013 and has seen its shares more than halved since Dorsey returned to Twitter in July.
An exodus of some top executives last month added to investor concerns about the company's ability to reignite stalled growth.
The company's share price fell 6.6 percent to $13.99 in trading after the final bell in New York.
Twitter said in a filing it had 320 million average monthly active users in the fourth quarter of 2015, unchanged from the third quarter and lagging behind a forecast of 323 million users from RBC Capital Markets. That makes Twitter's user base about one-fifth the size of Facebook and also smaller than Facebook-owned photo sharing network Instagram, which has more than 400 million users.
The San Francisco-based company predicted first-quarter revenue of between $595 million (528 million euros) and $610 million, well below the average analyst estimate of $627.1 million, according to Thomson Reuters I/B/E/S.
Revenue rose 48.3 percent to $710.5 million in the quarter ended December 31, and net losses shrank to $90.2 million, or 13 cents per share, down from $125.4 million, or 20 cents per share, a year earlier.
Facing slowing user growth, Twitter has been attempting to make its website more engaging under Dorsey, who became interim CEO in July and then CEO in October.
New timeline layout
Twitter announced a widely expected change to its product earlier in the day, saying it will alter how it displays tweets by customizing them to individual users rather than presenting a chronological list of messages. The move is designed to appeal to advertisers as paid for tweets would gain in prominence.
The new system relies on algorithms to track which tweets seem to matter most to individuals and places them at the top of the timeline. It's a setup similar to one used at rival Facebook.
"We think this is a great way to get even more out of Twitter," Mike Jahr, senior engineering manager for the company, wrote in a blog post.
Some Twitter users, however, have expressed their discontent with the timeline change.
sms/cw (Reuters, AFP, AP)