Now Twitter has revenue problems, and its stock is tanking

Twitter isn’t done growing just yet, but now it may have other problems.

The company reported its Q1 earnings on Tuesday and said it added five million new users last quarter to bring its total user base to 310 million users, up from 305 million monthly active users in Q4.

But on the business side of things, Twitter reported profits of 15 cents per share on revenue of $595 million. That was better than Wall Street’s expected profits of 10 cents per share, but was short of the Street’s revenue expectation, which was $608 million for the quarter.

Twitter also lowered its Q2 revenue guidance significantly. The company is targeting $590 million to $610 million in revenue this quarter, much lower than the analyst consensus, which was $678 million.

The stock is down nearly 11 percent on the news.

In its shareholder letter, Twitter said the revenue miss was because “brand marketers did not increase spend as quickly as expected in the first quarter.” Hopefully we’ll find out more about what that means on the earnings call, which is set for 5 pm ET. We’ll be liveblogging the call so be sure to tune back in.

The silver lining here for Twitter is a big one: Its user base actually grew last quarter after Twitter reported its first-ever user decline in Q4. The company said back in February that it expected user totals to be near those it reported in Q3 of last year, which was 307 million users, so Tuesday’s bump was certainly expected.

Twitter

BUT! As BTIG analyst Rich Greenfield points out on Twitter, the company appears to have hit a growth wall in the United States. Not good.

https://twitter.com/RichBTIG/status/725060808586219520

We are digging through the shareholder letter Twitter sent out and will update this story with more details if we find anything worth sharing.

This article originally appeared on Recode.net.

Will you support Vox’s explanatory journalism?

Most news outlets make their money through advertising or subscriptions. But when it comes to what we’re trying to do at Vox, there are a couple reasons that we can't rely only on ads and subscriptions to keep the lights on.

First, advertising dollars go up and down with the economy. We often only know a few months out what our advertising revenue will be, which makes it hard to plan ahead.

Second, we’re not in the subscriptions business. Vox is here to help everyone understand the complex issues shaping the world — not just the people who can afford to pay for a subscription. We believe that’s an important part of building a more equal society. We can’t do that if we have a paywall.

That’s why we also turn to you, our readers, to help us keep Vox free. If you also believe that everyone deserves access to trusted high-quality information, will you make a gift to Vox today?

One-Time Monthly Annual

$5/month

$10/month

$25/month

$50/month

Other

$

Yes, I'll give $5/month

Yes, I'll give $5/month

We accept credit card, Apple Pay, and Google Pay. You can also contribute via