Investors were in for a rude shock after Twitter, Inc TWTR posted first quarter 2016 results. Adding to its stagnating user growth and inability to turn up profits, yesterday Twitter alarmed Wall Street with the news of a fresh trouble.The company stoked fears by saying “brand marketers did not increase spend as quickly as expected in the first quarter”. Brand marketing is one of the primary contributors to the company’s revenues. As a result, Twitter’s revenues of $594.5 million came in way below the Zacks Consensus Estimate of $607.2 million. Expecting no near term respite, Twitter gave second quarter revenue guidance of $590 to $610 million, which was nowhere close to the Zacks Consensus Estimate of $678 million.Twitter also failed to yield any profit this quarter. In fact, it is yet to rake in profit in its 10-year history. Twitter reported an operating loss of $59.1 million, which compared favourably with a loss of $146.6 million reported in the year-ago quarter.We have always maintained that Twitter’s ability to attract advertising revenues amid significant competition from the likes of Facebook FB and Alphabet GOOGL will be a key factor determining its growth, considering the fact that investment in product development needs to continue. With troubles emanating from this area, we are more than ever cautious about what lies ahead for this micro blogging site.Amid all this, Twitter did manage to record user growth, although it wasn’t an impressive number. Twitter’s users grew from 305 million monthly average users (MAUs) to 310 million MAUs this quarter, a jump of 1.6% sequentially. It is to be noted that Twitter has changed the way it counts users. Unlike earlier, MAUs now do not include SMS Fast Followers. The stock was punished badly in aftermarket trading. It tanked over 13% to close at $15.36.Quarterly Numbers in DetailsTwitter’s adjusted loss of 7 cents per share compared favorably with the Zacks Consensus Estimate of a loss of 13 cents.The company posted non-GAAP earnings per share of 15 cents per share, up from 7 cents earned in the year-ago period.Twitter’s year-over-year revenue growth in the first quarter was 36.4% compared with nearly 75% growth witnessed in the first quarter of 2015. Twitter’s advertising revenues increased 37% year over year to $531 million. Also, there was a 208% year-over-year surge in ad engagements but cost per ad engagement was down 56%, given the shift to auto play video, which has lower cost per view compared with click to play.Mobile advertising revenues contributed 88% to total advertising revenue in the quarter while Data licensing and other revenues soared 34%.Twitter earned 34.3% of its revenues from international markets. International revenues rose 39% year over year to $204 million in the reported quarter. U.S. revenues increased 35% year over year to $390 million.The company reported adjusted EBITDA of $180 million, up 73% year over year. Adjusted EBITDA margin was 30%, up from 23.8% in the year-ago quarter.Non GAAP expenses increased 12.2% year over year to $653.6 million.Balance Sheet & Cash FlowAt the end of Mar 31, 2016, cash and cash equivalents (short-term investments) were $3.57 billion compared with $3.49 billion at the end of Dec 31, 2015. In 2015, cash flow from operations was $162.8 million in the reported quarter and free cash flow was $99.3 million.OutlookFor the second quarter of 2016, adjusted EBITDA is projected to be in the range of $145 million to $155 million. The company expects stock-based compensation expense to be in a band of $165 million to $175 million.For 2016, its guidance remains unchanged. Adjusted EBITDA margin is expected to be 25% to 27% while capex is likely to be around $300 million to $425 million.Final WordTwitter’s troubles are far too many with no solution in sight. In order to attract more users, while fully monetizing the existing ones, the company has been implementing a lot of changes. A new way to display tweets was introduced and live video streaming app Periscope was integrated in its feed. News curation tool, Moments, was a step in the same direction. Moreover, Twitter now makes tweets available on Google search to woo the 500 million users who do not log in but keep a track of tweets. Last December, the company launched ads for logged out users.It recently won the rights to stream NFL, outbidding the likes of Facebook and Amazon AMZN. Twitter commented that “The demand from the marketing community has been strong, and as a result, we expect to access new online video budgets,” for its deal with Thursday night NFL.Co-founder Jack Dorsey also continued to emphasize “Twitter is live”. However, Facebook and Snapchat are expanding into this territory, threatening Twitter’s growth prospects (if any).Plus, investors had cheered the appointment of co-founder Jack Dorsey as CEO for the second time with hopes that he will pull it all together for Twitter. Despite Dorsey being at the helm for almost six months, there hasn’t been much change in Twitter’s fortunes.Twitter shares have lost over 43% of their value in the past six months and nearly 23% year-to-date and are trading lower than its IPO price of $19. Amid all this, high profile executive departures are adding to its woes. Also sharing a CEO with another company is not just not doing Twitter any favor.At present, Twitter carries a Zacks Rank #3 (Hold).Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report AMAZON.COM INC (AMZN): Free Stock Analysis Report FACEBOOK INC-A (FB): Free Stock Analysis Report ALPHABET INC-A (GOOGL): Free Stock Analysis Report TWITTER INC (TWTR): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research