TWITTER FALLS ON GROWTH, NEW COSTS

international becoming more than half of revenue at Twitter,” chief financial officer Ned Segal told analysts on a conference call, highlighting strength in Japan, Britain, Brazil and the Middle East.

But analysts pointed out foreign users are often less profitable for the company.

“Adding users in far reaches of the world has very little value for Twitter,” said Ross Gerber, chief executive officer of investment firm Gerber Kawasaki.

The social media sector is under pressure from lawmakers around the globe for inflaming political debates, allowing abusive language increase ad sales and meet other priorities.

Twitter cut its head count six per cent last year.

Its shares traded down 3.5 per cent in afternoon trading in New York at US$29.40 on the New York Stock Exchange. Through Tuesday’s close, they were up 26.9 per cent this year, compared with a 1.5-per-cent decline in the S&P 500 Index.

Twitter shares trade at 42 times expected earnings over the next 12 months, roughly double the 20.5 times ratio of Facebook, according to Thomson

Total revenue rose to US$664.9 million, beating analysts’ expectations for US$607.6 million, according to Thomson Reuters I/B/ E/S.

Twitter swung to a net profit of US$61 million, or 8 cents per share, in the first quarter, from a loss of US$61.6 million, or 9 cents per share, a year earlier. Excluding items, the company earned 16 cents per share, topping the average analyst estimate of 12 cents per share.

Twitter has tried tweaks to its core product to try to broaden its appeal. Last year it doubled the maximum length of tweets in most languages to 280 characters, and it added customizable anti-harassment tools such as the ability to mute tweets with certain words.

The company has developed live shows and broadcast live events to get people to spend more time on the service and to sell video ads to marketers. Videos accounted for more than half of ad revenue in the quarter.