Twitter, the social media company, gave investors a dismal forecast Tuesday for its fourth-quarter revenue and profits, sending its stock plunging more than 10 percent in after-hours trading. The forecast, delivered as the company exceeded projections for its third-quarter results, suggests that Twitter is failing to gain traction with advertisers, the source of most of its revenue, amid stiffening competition from Facebook, Instagram and Google.

Twitter’s nascent efforts to lure more newcomers to the service are also not yet delivering results. The company said it had 320 million users in the third quarter, up slightly from 316 million in the second quarter. Excluding people who subscribe to the service via text message, a group that Wall Street considers less valuable, the company had 307 million users, roughly flat with the previous quarter.

Twitter also reported revenue of $569 million for the quarter, up 58 per cent from $361 million a year ago. Its net loss was $132 million, or 20 cents a share, compared with a loss of $175 million, or 29 cents a share, in the same quarter last year.

Excluding common business expenses such as stock compensation, taxes and depreciation – a measure called adjusted Ebitda that the company prefers to highlight – Twitter reported a profit of $142 million compared with $68 million a year ago. The actual numbers beat analysts’ estimates, which had been recently raised.

All eyes are on Jack Dorsey, the company co-founder who was named permanent chief executive this month. Shareholders are eager to know more about his plan for reinvigorating Twitter, which has struggled to make its service appealing to people who do not have the time and inclination to create the custom feeds of information that so enchants devoted users of the service.

Last quarter, Dorsey, who was then the interim chief executive, acknowledged that Twitter was too hard to use but offered little detail about how he planned to change that. Earlier this month, Twitter added a feature called Moments, in which it selects the top posts about popular topics, with the goal of engaging casual users.

Adam Bain, the advertising chief who was promoted to chief operating officer when Dorsey became permanent chief executive, will soon play a much more important role in running the company's daily operations, as Dorsey focuses more of his attention on Square, the digital payments company that he also heads. Square has filed for an initial public offering of stock, and Dorsey will soon embark on a so-called road show, a series of meetings with potential investors to pitch the merits of Square shares. – New York Times service