"He brings a principled, engaging and rigorous approach to the CFO role, with a track record of driving profitable growth," CEO Jack Dorsey said in a statement.
Anthony Noto, who has served as both chief financial officer and chief operating officer, will retain his COO duties, Twitter said in a statement.
The appointment of Segal fills out Twitter's leadership ranks after the departure of several key employees.
Noto had stepped in to fill the shoes of Adam Bain, former chief operating officer who announced last fall he would leave the company. Dorsey runs two public companies (he is also CEO of Square) and Twitter also lost its chief technology officer in the past few months.
Twitter has lagged Facebook in online advertising: Twitter shares are up 5.25 percent over the past year, while Facebook shares have risen nearly 32 percent. The loss of a key NFL streaming deal and quashed prospects of a sale of the company have also dragged the company's growth.
Twitter announced in May that co-founder Biz Stone would also be returning to "guide the company culture."
With Segal on board, Twitter will try to "extend our positive momentum, continue growing our audience and achieve greater operating efficiency," Dorsey said in a statement.
— CNBC's Julia Boorstin and Sally Shin contributed to this report.