Twitter Inc. posted record high revenue numbers in the fourth quarter of 2014 of the back off increasing ad sales, however user number growth not only slowed, but contracted.

For Q4 Twitter posted revenue of $479 million, up 97 percent of the same quarter in 2013, however it saw a net loss of $125 million and non-GAAP net income of $79 million.

For the year ending Deember 31st, Twitter’s revenue came in at $1.403 billion, up 111 percent on 2013, but again negatively the microblogging site posted a net loss of $578 million in 2014, and non-GAAP net income of $101 million.

“We closed out the year with our business advancing at a great pace. Revenue growth accelerated again for the full year, and we had record quarterly profits on an adjusted EBITDA basis,” CEO Dick Costolo said in a statement. “In addition, the trend thus far in Q1 leads us to believe that the absolute number of net users added in Q1 will be similar to what we saw during the first three quarters of 2014.”

The numbers beat Wall Street expectations coming in at $0.12 per share versus an expected figure of $0.06 per share, and the market liked it, with Twitter shares up 54 cents (1.33 percent) in after hours trading.

One concern for Twitter going forward though is that is that it actually lost users in Q4.

Average monthly active users were 288 million in Q4, up 20% year-over-year, but at the same time a loss of approximately 4 million net monthly active users in Q4 versus Q3 due to what Twitter describes as “changes in third party integrations.” In an investor call after releasing the numbers Twitter fancifully blamed an iOS 8 bug.

Timeline views were up though and reached 182 billion for the fourth quarter of 2014, up 23 percent year-over-year. Advertising revenue per thousand timeline views reached $2.37 in the fourth quarter of 2014, up 60 percent year-over-year.

User growth slowing, or even going backwards as it did in Q4 will present challenges for Twitter going forward. While the company is branching out into new spaces such as selling ads on third party sites, it may need to pull some new rabbits from the preverbial hat if it wants to keep the support of investors going forward. Social networking can be a fickle space, and you only need to look to the likes of Myspace to know that what was a popular service one day can easily become worthless in a short space of time.

photo credit: Twitter on the Underground via photopin (license)