Twitter is finally learning how to go beyond a tweet to explain what it is doing, and Wall Street likes what it hears.
On Wednesday, Twitter executives laid out for the first time an ambitious strategy they hope will place its revenues on a par with those of Internet giants like Amazon and Google. And they pledged to more quickly introduce improvements and new features.
“We are working toward a Twitter that everyone in the world can get value from immediately,” Twitter’s chief executive, Dick Costolo, said as he opened the company’s daylong presentation to financial analysts in San Francisco.
By detailing its plans for the first time since its initial public offering last November, Twitter sought to address investors’ concerns about the future of the company, which has experienced management turmoil, disappointing growth and declining use by its more loyal users.
Twitter largely accomplished that goal, at least in the short term. Its shares rose sharply, closing on Wednesday at $42.54, up $2.95, or 7.5 percent. That is still below the $44.90 close of the company’s first day of trading after its offering last year, but it is up from a low of around $30 reached in May.
The company’s openness was a striking contrast to its past practice of speaking mostly through tweets and blog posts and avoiding discussion of unreleased products.
Before the end of the year, for example, Twitter said it would unveil better private messaging. The company also said that early next year, it would offer users the ability to shoot and post live video. Also in development are ways to show newcomers an instant feed of relevant posts and to show returning users a list of top posts that they have missed since they last logged in.
Anthony Noto, a former Goldman Sachs investment banker who joined the company as chief financial officer this year, took the lead in setting the new tone, acting as M.C. for the investor event and dropping tidbits, including a highly speculative graphic of how Twitter could one day become a revenue giant.
While analysts were impressed by the plans that Twitter shared, they said investors needed to see Twitter start to deliver on those plans.
“Twitter laid out a lot of exciting new product elements to improve the product, making it easier for consumers to understand Twitter,” Richard Greenfield, an analyst with BTIG Research, said in an email. “The question becomes, Will the product innovations drive a significantly larger user base and greater engagement/time spent with the product? Time will tell.”
Debra Aho Williamson, a social-media analyst with the research firm eMarketer, had a similar show-me attitude. “It was a lot of pictures and diagrams and descriptions of what Twitter hopes to do,” she said.
The company is simultaneously trying to persuade Wall Street to accept new measures of success.
Mr. Noto dismissed concerns that the number of posts on the service has remained flat at about 500 million per day. He said Twitter was focused on getting people to read more, not post more. “We really need to build a consumption-first experience,” he said.
The company disclosed that more than 500 million people visited Twitter every month but were not signed up for or logged in to the service, suggesting that there might be a large, untapped group of people who might use the service more and be shown ads. Twitter had 284 million monthly users globally in the third quarter.
Trevor O’Brien, a Twitter product executive, said the company was trying to find ways to attract more casual visitors, such as by making posts easier to find in Google searches, with the hope of showing them the value of the service. “We want to make sure every time you visit Twitter, you get great content,” he said.
Wall Street was keen to learn how Twitter planned to make more money, particularly from advertising. Mr. Noto said 1.3 percent of the posts in a user’s feed are now ads. The company hopes to increase that to 5 percent — Facebook’s level — without reducing the quality of the ads or their performance for advertisers. He said Twitter was also planning to show ads for the first time to those 500 million people who visit the service but never log in. It may also strike revenue-sharing deals with partners who syndicate Twitter content.
Putting on his salesman hat, Mr. Noto said the company could one day bring annual revenue of more than $11 billion, up from projections of about $1.4 billion this year.
“We believe we have the best aggregated content on one platform in the world, much of which is unique, appeals to everyone and is relevant on a daily basis,” Mr. Noto said.