SAN FRANCISCO -- Twitter reported the resignation of its chief operating officer Thursday, as the trendy social networking service continued to wrestle with slowing user growth.
Ali Rowghani's move comes amid a broader reorganization at the company, which has seen other top executives leave and its stock price plunge in recent months. Twitter has reported strong growth in advertising sales, but analysts say investors are worried because it's not adding new users as fast as Facebook and other popular social media.
Twitter "is just not for everyone," said Brian Wieser of Pivotal Research, adding that the company may have raised unrealistic expectations for its appeal across the broad spectrum of Internet users.
Rowghani's departure marks a stark contrast from a few months ago, when the 41-year-old was dubbed "Mr. Fix-It" in a glowing Wall Street Journal profile that described him as almost a "co-CEO" to Twitter Chief Executive Dick Costolo. Rowghani was chief financial officer at Pixar for nine years before joining Twitter in the same role four years ago, and he was credited with steering Twitter through a successful initial public stock offering last fall.
But as chief operating officer, Rowghani was also responsible for overseeing new products and confronting Twitter's slowing growth rate. The company had 200 million monthly active users at the end of 2012 and gained about 40 million more in 2013, despite Costolo's reported goal of hitting 400 million by the end of last year.
Twitter now has about 255 million monthly active users; Facebook has almost five times that many with 1.28 billion users around the world.
The company had little to say about Rowghani's departure Thursday, except for a terse regulatory filing that said he resigned as chief operating officer and would not be replaced. The filing said Rowghani will act as an adviser to Costolo, which the company has said about other departed executives. But in a post to his personal Twitter account, Rowghani indicated he is leaving.
"Goodbye Twitter. It's been an amazing ride, and I will cherish the memories," he wrote.
Costolo replied by tweeting: "Thank you for being an incredible executive & partner. Twitter could not have succeeded without you."
Despite the warm exchange, there were hints of discord before Thursday. After Twitter hired a veteran Google executive, Daniel Graf, as chief product officer in April, Costolo decided Graf should report directly to him. The previous product chief, Michael Sippey, had reported to Rowghani before he left the company in January. Christopher Fry, the company's longtime head of engineering, left in May.
It's not uncommon for executives to leave after seeing a company through its IPO, said Scott Kessler, an analyst for S&P Capital IQ. He noted that Twitter has seen healthy increases in advertising, with overall revenue rising to $250 million in the most recent quarter, up 119 percent from a year earlier.
But Kessler said many investors have focused on sluggish user growth and related statistics that Twitter had previously touted as indicators of its strength as a company.
"Twitter has been punished for not delivering on metrics that they themselves highlighted as important," he said. Twitter is now emphasizing other measurements -- such as the number of times that users retweet or take other actions -- which can show advertisers that users are engaged and paying attention to what they're seeing, Kessler added.
After rising to nearly $75 last winter, Twitter's stock had fallen more than 44 percent this year, although it regained some ground in recent weeks. Shares rose more than 3.5 percent Thursday, closing at $36.79, after Rowghani's resignation was announced.
Concerns about Twitter's growth were highlighted last month by a report from research firm eMarketer, which projected Twitter would increase active users by 24 percent this year, down from 30 percent in 2013 and 50 percent in 2012. Much of its growth is expected in Asia and other countries, while Twitter relies on the United States for most of its ad revenue.
Costolo has acknowledged that new users can be discouraged by some Twitter features that may be confusing at first, such as hashtags and retweets. He vowed earlier this year to simplify the service and make new features easier to use.
By not replacing Rowghani, Costolo may be signaling he plans to be more active in overseeing new products and company operations. While not every company has a chief operating officer, the job usually involves overseeing day-to-day business so the CEO can focus on broader strategy.
Rowghani's departure may also be tied to other factors. The tech blog ReCode reported that others inside the company were annoyed by his favorable press coverage and that some questioned his decision to sell 300,000 shares of Twitter stock in May, when other executives pledged to hold their shares as a sign of faith in the company.
The sale netted Rowghani a profit of $9.9 million. He reportedly told an employee gathering that he wanted to help fund medical research targeting a disease that caused his father's death.