Jack Dorsey is now the permanent chief executive at Twitter. Above, Dorsey and co-founders Evan Williams and Biz Stone, wait for the opening bell to be rung at the New York Stock Exchange, Thursday, Nov. 7, 2013.(AP Photo/Richard Drew)

Twitter on returned to its roots and appointed co-founder Jack Dorsey as chief executive to steady the struggling company as it seeks to grow its audience.

The 38-year-old, who was Twitter’s first chief executive until his ouster in 2008, will be taking on a daunting challenge -- broadening the social network’s appeal beyond its core users while also finding ways to consistently turn a profit.

“The world needs a Twitter that not only remains relevant but thrives and continues to redefine what came before it,” Dorsey said during a conference call. “I will do whatever it takes to see that through.”

That means Twitter users can expect to see some fundamental changes to the service soon.

In the call with investors, Dorsey and company executives highlighted several product and business improvements that Twitter has undertaken since 2011 when Dorsey returned to the company — longer direct messages, better advertising products and the company’s planned “Project Lightning” product, which will highlight breaking news on the network to pull more users into real-time conversations. There are also rumors that Twitter may consider lifting its signature 140-character limit on messages.

With Dorsey officially in the top position, the company may be better able to navigate these changes without angering loyal fans who have given Twitter a reputation that’s always seemed bigger than the 300 million people who use it on a regular basis. It is less than one-third the size of Facebook; even Facebook’s Instagram has 100 million more users than Twitter.

Adam Bain, who had been rumored as a candidate for the top job at Twitter, will become the company’s chief operating officer. Twitter announced Monday that former chief executive Dick Costolo, who stepped down in July, has resigned from the board. Dorsey, who first returned in 2011 to help product development, has been serving as interim chief executive since Costolo left the job.

It’s hard not to see Monday’s announcement as redemption of sorts for Dorsey, who was Twitter’s first chief executive before being pushed out in favor of his fellow co-founder Ev Williams, amid concerns that he had neither the business chops nor the focus to be an effective company leader. Dorsey has said his dismissal landed like a "punch in the stomach."

But Dorsey appeared to have learned from his failures at Twitter and successes at Square, evolving into a more seasoned leader, analysts said.

“He’s matured as an executive,” said Brian Blau, an analyst at Gartner. “He went off and built Square, yet another company breaking out from the traditional way of doing things.”

Also of note, Twitter said it currently has “no plans to provide Mr. Dorsey with direct compensation for his role” as chief executive. A Twitter spokesperson declined to provide further details. Forbes has valued his net worth at $2.2 billion, and an August regulatory filing said Dorsey owned 21.9 million shares in Twitter.

Dorsey has been running his mobile payments company Square even as he was becoming more involved in Twitter’s affairs. Despite Twitter’s initial contention that it was looking for someone who would take on the role on full-time, support for Dorsey has been growing.

“Our goal for this selection was simple but ambitious: Find a CEO to take Twitter to the next level and help us to achieve what we see as a massive opportunity to grow the company,” said Peter Currie, Twitter board member and chair of the search committee. “Jack has thought more about Twitter than anyone else.”

On his own Twitter feed, Dorsey said he is up the challenge of running two companies, emphasizing how he has strong support teams at both Square and Twitter.

Dorsey's ambitions are clearly broad. When asked if Twitter should focus on building a general audience or pumping up efforts to make money from its core audience, Dorsey said that he wanted to do both.

The road ahead is not easy. The company's audience growth has slowed significantly. Twitter has some time to execute a comeback, thanks to the strength of the Twitter brand cultivated by Dorsey and others, said Blau, the Gartner analyst.  But the runway won't last forever, he said.

"Most users aren't aware of what's going on with Twitter management; most users don't really care," he said. "What they want is a fun, interesting service to use when they pick up the phone."

Investors, who have hammering the company’s shares for months, sending them down more than 20 percent this year, appeared to welcome Dorsey’s appointment. The company’s stock jumped 7 percent Monday.

Staff Writer Jena McGregor contributed to this report.