Twitter, Inc. is likely to be acquired by either Google or Facebook but it is not as cheap as it might seem to be.
The social media network Twitter, Inc. has had a long and tough year; Twitter’s former chief executive officer, Dick Costolo resigned this year, the user growth of Twitter declined miserably, also their ad strategies were a complete failure. At this point, it is believed that Twitter could be easily acquired by any social media website because it is said to hit rock bottom now.
Earlier this year, there was a rumor that Google might be buying Twitter, Inc. although those rumors turned out to be false, however, this resulted in increment of nonetheless. According to analysts, Twitter is at least worth $25 billion to $30 billion, since its current market capital is said to be at $18 billion. company shares
Considering the social giant's worth, currently, the best suitors who can afford such a company are: Google and Facebook. Although neither one of them have ever previously paid such an amount to acquire a company, Facebook bought WhatsApp for around $19 billion, which to date remains its biggest purchase. Google on the other hand purchased Motorola Mobility when the company was worth at $12.5 billion.
Facebook bought WhatsApp in order to replace the concept of SMS service and dominate the messaging market. Later it bought Instagram, the photo-sharing app, which had a gigantic usage amongst the younger generation. Taking a look at Twitter's features, on can realize that it does not really focus on one market. Twitter has mixed features that does not exactly have a specific target audience. When Facebook acquired both WhatsApp and Instagram apps, they had a high user growth potential and the company's main aim was to grow its monthly active users. Whereas Twitter is already at a decline when it comes to its monthly active users (MAUs).
As for Google, it already has access to a few of Twitters features, as both the companies had an agreement to bring Tweets back to Google Search in February. Google has constantly tried to be a part of the social media network but has mostly failed to do so. Ruth Porat, the Chief Finance Officer at Google, has planned not to make any big purchases and also cut down on the expenses for the rest of the year, so it is quite evident that they will not be making any big purchases or acquisitions this year.
There might be a possibility of the company's acquisition but Twitter’s market value is relatively high since it pays its employees through stock based compensations. It does so by issuing more stocks every quarter; this does not necessarily increase its actual earnings but presents the company as an expensive one and targets less to be the one likely to be acquired.
The social media network Twitter, Inc. has had a long and tough year; Twitter’s former chief executive officer, Dick Costolo resigned this year, the user growth of Twitter declined miserably, also their ad strategies were a complete failure. At this point, it is believed that Twitter could be easily acquired by any social media website because it is said to hit rock bottom now.
Earlier this year, there was a rumor that Google might be buying Twitter, Inc. although those rumors turned out to be false, however, this resulted in increment of nonetheless. According to analysts, Twitter is at least worth $25 billion to $30 billion, since its current market capital is said to be at $18 billion. company shares
Considering the social giant's worth, currently, the best suitors who can afford such a company are: Google and Facebook. Although neither one of them have ever previously paid such an amount to acquire a company, Facebook bought WhatsApp for around $19 billion, which to date remains its biggest purchase. Google on the other hand purchased Motorola Mobility when the company was worth at $12.5 billion.
Facebook bought WhatsApp in order to replace the concept of SMS service and dominate the messaging market. Later it bought Instagram, the photo-sharing app, which had a gigantic usage amongst the younger generation. Taking a look at Twitter's features, on can realize that it does not really focus on one market. Twitter has mixed features that does not exactly have a specific target audience. When Facebook acquired both WhatsApp and Instagram apps, they had a high user growth potential and the company's main aim was to grow its monthly active users. Whereas Twitter is already at a decline when it comes to its monthly active users (MAUs).
As for Google, it already has access to a few of Twitters features, as both the companies had an agreement to bring Tweets back to Google Search in February. Google has constantly tried to be a part of the social media network but has mostly failed to do so. Ruth Porat, the Chief Finance Officer at Google, has planned not to make any big purchases and also cut down on the expenses for the rest of the year, so it is quite evident that they will not be making any big purchases or acquisitions this year.
There might be a possibility of the company's acquisition but Twitter’s market value is relatively high since it pays its employees through stock based compensations. It does so by issuing more stocks every quarter; this does not necessarily increase its actual earnings but presents the company as an expensive one and targets less to be the one likely to be acquired.