On Friday, Twitter shareholder Doris Shenwick filed a lawsuit against the company for allegedly misleading investors about its growth projections.
The lawsuit claims that in November 2014, Twitter promised investors that the size of its active monthly user base would increase to 550 million in the “intermediate” term and to over one billion in the “longer” term. Shenwick intends to file a class-action suit that would represent people who bought Twitter stock between February 6th, 2015 and July 28th, 2015. We reached out to Twitter for comment and did not receive an immediate response.
Twitter currently has 313 million active monthly users as of June. To put that in context, Instagram has 500 million active monthly users. Facebook has 1.71 billion. Snapchat, founded in 2011, has more daily active users than Twitter which was founded in 2006.
Twitter has been under fire lately for the way it deals with (or doesn’t deal with) targeted harassment. The company has been struggling to attract new users and be as profitable as its competitors.
Perhaps Twitter misled investors with its 2014 projections, but you could also make the assumption that perhaps the company just really believed that it would grow. This lawsuit seems petty—sometimes investments don’t pan out. Twitter can’t predict the future. [Bloomberg]