In 7.0, user avatars are displayed as initials (first character of their first name, and first character of their last name). For example, the OOTB firstname.lastname@example.org user's name is listed as First Name "Test" and Last Name "Test", meaning the avatar for this user will be "TT".
While the functionality is working perfectly, this unfortunately does not translate well for...
A. Languages that do not use the Latin alphabet for a person's name (e.g. Japanese and Chinese use multibyte characters that would be unintelligible if the characters were broken up)
B. Languages and cultures that use different naming conventions (e.g. Hungarian names are Family Name + Given Name)
As mentioned, while the functionality is working perfectly, but I believe this functionality might be underdeveloped, considering that this does not take into account of the global use of the product and the respective underlying cultural considerations behind how names are used.
Example of the issue
1. Create a new user, and set their regional/setting to Japanese
2. For the last name set 本間
3. For the first name set 翼
4. Save the user, and change the password so that you can log in with the new user
5. Open a new browser, and login as the new user
Results: Monogrammed user icon is nonsensical in Japanese reading: TsubasaHon (i.e. 翼本). This is incorrect in Japanese because names are read family name + given name. Secondly, monograms don't really work in Japanese as you can see in the example. Instead, family names are typically used. Family names would work in Japanese as they are usually 1-2 characters.
Please consider the cultural and language implications of user names per each localization set that is available out of the box. Because Liferay is used around the globe and can be configured so that many languages can be used out of the box, I think this functionality would add a tremendous amount of value.
Another option would be to simply allow replacement avatars for the initialed user profile picture placeholder that the administrator can choose from.