News Column


February 2, 2014

Simon Goodley

When Twitter floated at $26 (pounds 16) a share in November, there were plenty of those who said its $17bn valuation was totally crackers. The price looked ridiculous for a firm that had never made a profit and was on course for revenues of "only" $600m . Well, it looks even more bonkers now. The shares have surged by 150% and are changing hands at about $65 each, so a company celebrating its eighth birthday this year is worth about the same amount as Rolls-Royce , whose heritage is exactly 100 years longer. Clearly Twitter is a popular website - a social phenomenon, say some - but we get back to the dreary old numbers this week when the company announces its first set of results since listing. It is expected to report a loss of $0.39 a share in the fourth quarter on revenue of $217.78m , taking it to sales of about $640m for 2013. That's double 2012's figure, but Twitter has yet to prove its worth in online advertising. The fear is that adverts will infuriate users as much as the rising shares irritate the naysayers. But, surely, none of this will last.

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Source: Observer (UK)

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