Twitter Now Worth Less Than Its Chinese Clone
Twitter has been having a rough Fall.
Its stock began to soar amid acquisition rumors by companies like Alphabet, Apple, Disney, and Salesforce. But those rumors died and the stock began to die as well.
On October 5th TWTR was at $24.87. This morning the stock is at $16.77.
That steep drop has made Twitter less valuable than its clone, China’s Weibo. Weibo IPO’d in 2014 at a valuation of US $3.4 billion. On that same day, Twitter was valued at US $26.8 billion.
It’s all about growth. Twitter lost 5 million monthly active users in the past 12 months, with the current tally at 313 million. Weibo, in contrast, is still growing – now at 282 million. Weibo pulled in 70 million new active users in the past year.
The Twitter dive is especially bad news for its employees since Twitter has been reliant on stock-based employee compensation. Twitter’s stock-based compensation expense in 2015 of $682.1 million represented 18% of revenue, more than any other U.S. technology company with a market value of at least $1 billion, according to FactSet.
Sorry Jack, but now that it seems no one wants to buy Twitter, expect to see even more talent leave.