Twitter’s User Growth Is Not a Problem: Wieser

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Feb. 6 (Bloomberg) -- Pivotal Research Senior Analyst Brian Wieser examines Twitter’s user growth and their first earnings report. He speaks with Stephanie Ruhle and Erik Schatzker on Bloomberg Television's "Market Makers." (Source: Bloomberg)

Popular anymore?

Brian covers twitter for pivotal research.

He is with us from portland.

You have a cellsell rating on the stock.

However, you do not share concerns over user growth or user engagement.

That is what everyone else is bouncing on.

How come you go as i have said in the past, users-schmu sers.

Greg slim get that technical term down -- let me get that technical term down.

The first thing is, if i was paying attention to every single newspaper, let alone website, circle -- circa october or whenever this came out, wasn't this something people were already aware of gekko this -- aware of that?

The reason i was never concerned about them growing their user base is because twitter was always going to be a niche medium.

Revenue growth goes against executing what they have already gotten place.

They are going to marketers and showing ideas about how to use this as a marketing vehicle.

What matters is not the number of users, but the number of advertisers.

How about one user we have not seen lately accor jeff morrissey hasn't tweeted in a few -- jack dorsey hasn't tweeted in a few weeks.

What gives?

I have no idea.

I think i'd tweeted once in 2007 and have done five after that.

It's not for everybody.

But clearly there were a large number of investors who believed twitter was something more than it is right now.

Either they had wildly optimistic assumptions about how much user revenue it could generate, or they had wild assumptions about how quickly the user base could grow.

On which assumption were they wrong?

I think they were too focused on user growth as the only metric that matters.

I think this notion has been wrongly socialized into the investor community.

Is that because of facebook and facebook going to a billion users?

Part of this is that analysts tend to work with the numbers they are given, not the numbers they need.

What is the different -- difference?

What they should be doing is telling us the amount of spending her advertisers among different tiers of advertisers.

That is far more useful but you don't want to give that data away for various reasons.

Telling investors have many users you have is good to give them a sense of scale, but it is not a measure of revenue.

So buying purging analysts like you, your peers, to feast on monthly average user growth and timeline views, you have created metrics that you can live up to or expectations for metrics that there is no way you can live up to?

That is part of the problem.

I think they are working off data points that -- all he talked about on the conference call was the slope of the growth curve.

He is clearly panicking over the fact that they are not growing users faster.

But whether the number of users would change the guidance, the answer was effectively no.

I know the analyst kept asking questions, but they began the whole conference call -- the preamble to every thing was going on about how they are going to change user investment -- user engagement and try to get more users on twitter.

To be clear, you need users.

And the core of the product development -- you could see the same issue at yahoo!

Where marissa mayer is not focused on advertising by product and she

This text has been automatically generated. It may not be 100% accurate.


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