Twitter Has A Serious User Growth Problem Ahead Of Its IPO [STATS]

In its latest IPO filing Twitter revealed that it now has 230 million monthly active users (MAUs) through September 2013, up from 218 million at the end of June 2013. This represents a gain of 12 million MAUs, or 5.5 percent. This is down from quarter-on-quarter MAU growth of more than 10 percent in Q3 and Q4 2012, and Q1 2013. As we get closer to the IPO, this slowdown is a serious problem for Twitter. Here's a chart that plots quarter-by-quarter MAU totals for Twitter from March 2012 until September 2013. A pretty steady ascent. Indeed, Twitter grew some 90 million users - almost 50 percent of its total - in the year between March 2012 and March 2013. However, since then, growth has noticeably slowed. Check the chart below that plots quarter-on-quarter MAU percentage growth for Twitter. June 2013's 6.9 percent was already a big drop from the three 10+ percent quarters we'd seen before, but September 2013's 5.5 percent is even worse. Even if we assume the next quarter from Twitter will be as good as Q3 2013, that means that Twitter will have added just 11.5 million MAUs through end December 2013, for a total of 241.5 million users. How does this compare to Facebook? Check the chart below for Facebook's quarter-on-quarter MAU totals over the same period as Twitter's. Facebook's September 2013 MAU figures haven't been released, so I have the data through June of this year. Here's Facebook's quarter-on-quarter growth chart over the same time. Huh. It's worse than Twitter's. Facebook hasn't had a 10 percent MAU quarter boost in a long time. But here's the thing: Facebook already has more than one billion MAUs. It's over four times Twitter's size, so it's going to struggle to see similar percentage gains, simply because it's already so big. But even excusing that, Facebook is still adding 40-50 million MAUs each and every quarter. That's 3-4 times what Twitter is doing, even though Facebook should be, relatively, tapped out. Ready for the money quote? Twitter has grown by 63 million users in 12 months. Facebook adds about 65 million users every 6 weeks. Facebook has about 900 million more users than Twitter, which means that Twitter has a ready-made pool of 900 million social-media friendly folks sitting out there, ready to be gobbled up and brought onboard. But for some reason, they aren't signing up. Why? The answer to that question is arguably Twitter's biggest obstacle both heading into this IPO, and in the months and years that follow. (Twitter image: petesimon via Flickr.)

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Twitter Has A Serious User Growth Problem Ahead Of Its IPO [STATS]

Shea Bennett

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Shea Bennett