DUBLIN: The news added around $3bn to the company’s valuation, helping to part reverse a 30pc slump in the stock over the past year.
Twitter has gone from stock market darling to also-ran as growth in user numbers has stalled and with investors sceptical about initiatives to accelerate sales. Yesterday’s massive rally took shares to almost $23 each, still well below the $26 a share valuation when the company listed in 2013.
This year the social media giant has grappled with its slowest revenue growth since going public in 2013. After an initial period of dramatic growth user numbers have stabilised at just over 300 million around the world.
The sale negotiations will test Twitter’s value both as a data and multimedia company, at a time when rival social media services such as Facebook’s Instagram and Snapchat are expanding their footprints and developing new ways to generate profits. Twitter is one of the smaller technology giants with an Irish presence. The company employs about 200 at its European headquarters in Dublin, including office head Mark Little.
In contrast Google employs 6,000 in Dublin, while Salesforce.com has a staff of around 800 in Ireland.
CNBC reported earlier yesterday, citing anonymous sources, that Twitter is in talks with companies that include Alphabet’s Google and Salesforce.com, and may receive a formal bid soon. Twitter and Alphabet could not be reached immediately for comment. Salesforce declined to comment.
Salesforce.com missed out earlier this year in bidding to buy LinkedIn, a social network aimed at business and professional users.
Twitter shares rose the most since its stock market debut in 2013, up 21pc to $22.59, giving the company a market capitalisation of close to $16bn.
Twitter has been a near-constant focus of takeover speculation amid persistently disappointing sales and user engagement. In its most recent quarterly earnings statement, Twitter’s revenue missed Wall Street estimates and the revenue forecast for the current quarter of $590m to $610m was well below the average analyst estimate of $678.18m.
As rivals such as Instagram and Snapchat gain traction with advertisers and social media users, investors have questioned how long Twitter could persist as a stand-alone company. Co-founder Jack Dorsey returned to the company as chief executive in 2015, but his plan for reviving Twitter is at best seen as unfinished.
