The Twitter stock price skyrocketed today on reports Google and Salesforce are considering bids for the struggling social media company.
Twitter stock price up over 20% so far
The market reacted very positively to reports Twitter was on the verge of possibly being sold. It’s the first positive market news Twitter has received in quite a while. That’s because Twitter has struggled for many years. Efforts to shift more into video, and then live video have not brought the expected benefits.
Twitter has been unable to grow their user base as much as shareholders wanted, and fell far behind Facebook in advertising.
While Facebook is a mass market social network, Twitter is much smaller.
Twitter’s stock price has declined dramatically in the past 5 years
Twitter’s five-year peak stock price was $69. It hit that number December 30, 2013. It tumbled all the way down to a low of $13.73 on May 23, 2016. Since then it hasn’t recovered much. Even with today’s 20% plus jump, the price is still below $23.
Google and Salesforce express interest in Twitter
According to a Wall Street Journal Report, Salesforce had wanted to purchase LinkedIn, but was beaten to it by Microsoft. While Twitter may be a consolation prize, there are some big boosters of a potential deal.
Vala Afshar – Chief Digital Evangelist for Salesforce is clearly a big Twitter fan:
1 personal learning network
2 the best realtime, context rich news
3 democratize intelligence
4 great place to promote others
— Vala Afshar (@ValaAfshar) September 23, 2016
If Google purchase Twitter, they would add to their already massive dominance of the internet. Consider what they could do when combining Twitter & YouTube functionality. The possibilities are quite exciting.
Possible Twitter sale is good news
The potential sale of Twitter is good news for fans of the social media network. There is clearly a demand for a service like Twitter. It just turns out that demand is not as big as the demand for Facebook. By being purchased by a larger company Twitter will gain financial security and stability. This contrasts with their attempts to make a profit standing on their own.
Salesforce and Google – especially Google – have shown good judgement in the market. If it turns out they are intent on competing for Twitter, it is a sign of the underlying value and utility Twitter brings to consumers.