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After a few weeks of lull, the speculations on the future of Twitter are divided the more beautiful Friday, September 23. According to the chain of financial information, CNBC, the platform of the 140 characters, which is going through a difficult time, would be planning to put on sale. Preliminary discussions have already been started with Google, the giant of the Web, and Salesforce, the software specialist in the cloud.
A Wall Street, these rumors, fueled by the british press, aroused the enthusiasm of investors. The action of Twitter jumped by more than 22 %, registering its biggest rise since its first day of trading in November 2013. In a single session, it has virtually erased all of the losses recorded since the beginning of the year.
However, many obstacles must still be overcome. Starting with the price. According to the specialized site Recode, Twitter would direct $ 30 billion (26.7 billion euros), or 3.8 billion more than the amount spent in June by Microsoft to buy LinkedIn, the social network for professionals. It is also a lot more than its market capitalization of $ 13 billion.
growth in advertising revenues is slowing down
The first step towards a sale, however, seems to have been taken. Thursday, September 15, at a meeting of the board of directors, this possibility would have been addressed, despite the reluctance of Jack Dorsey, the co-founder who took over the reins of the company in July 2015. According to the New York Times, two tracks have also been studied : a new social plan and the transfer of several activities, of which Vine, the platform to create videos of six seconds.
If the leaders of Twitter are ready to take the plunge, is that the recovery plan put in place by Mr. Dorsey soon yet to bear fruit. At the end of June, the network microblogging had 313 million active users in the world, with scarcely 9 million more than a year ago. In the United States, its most important market, the number of followers has only increased over the past two years. At the same time, the growth in advertising revenue is slowing down severely. On the first six months of the year, the turnover has risen by 27 %, compared with a gain of 67 % during the first half of 2015. The company also continues to lose money. Since its launch, ten years ago, it has never reached any kind of profit on a quarterly basis.
Pressure from shareholders
Upon his arrival, Mr. Dorsey had been warned that its efforts would take time. But the patience of the shareholders also has its limits. In the absence of results, the pressures increase to find an exit door. For months, Robert Peck, analyst at SunTrust, predicted a sale of the company in 2017. “If the growth in the number of users and their activity will continue to grow weakly, Twitter will not have other alternatives “, makes sense.
To attract new followers, Twitter tries to simplify its operation, for example by giving more and more concerned with the chronological order reversed. The group is also trying to impose new products. Launched at the end of 2015, the feature Moments, which lets you follow topics, however, has not convinced. The last bet Mr. Dorsey : the live broadcast of sporting events. the ” Twitter does not seem able to evolve to appeal to those who do not understand its added value or those who find it too complicated to use “, ” says Jan Dawson, analyst at Jackdaw Research.
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Four names of potential buyers come back with insistence : Google, Salesforce, Microsoft and Verizon. The first city is a favorite. The purchase of Twitter would allow him in particular to forget his many failures on the segment of social networks. The platform could be closer to YouTube, its video site, which incorporates more and more social components. In addition, Google has the expertise to multiply the advertising revenue of Twitter. Problem : the group of Mountain View has not the habit of spending so much money to conduct an acquisition.
The price could also be a problem for Salesforce, which investors worry already of the $ 4 billion spent in a year in buyouts. The mere rumor of his interest in Twitter has caused Friday, a decline of almost 6 % of his action. Microsoft has not yet completed the purchase of LinkedIn. And Verizon of Yahoo!.
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