Twitter goes public at $US45 a share
- 07 November, 2013 16:24
Twitter is now a publicly traded company, opening at a price of $45.10 a share, 73 per cent higher than its initial IPO price.
The micro-blogging company became the latest social network to launch an initial public offering, as traders spent the morning getting ready to begin trading the company's stock.
The company begin trading under the stock symbol TWTR on the New York Stock Exchange.
For Twitter, as well as for the social networking world, the IPO will be a milestone and a bellwether. Facebook, the largest social network in the world, had a troubled IPO disappointing IPO launch last year.
Now all eyes are on Twitter, a company that has yet to make a profit, to see if the company has charmed Wall Street, creating investor enthusiasm and pulled off a successful trading debut.
Late yesterday, Twitter closed its books and priced 70 million shares at $26. That values Twitter at $14.1 billion, though that number could climb if underwriters pull more optional shares in for trading.
Financial analysts earlier today said the Twitter's shares would start trading at $US44 to $US45.
Most thought a Twitter executive, like CEO Dick Costolo or co-founder Biz Stone, might ring the bell to begin trading on the New York Stock Exchange. Twitter, however, handed that illustrious job over to Patrick Stewart, the actor most famous for portraying Captain Jean Luc Picard in the Star Trek - Next Generation TV series.
To mark the occasion, Twitter tweeted, "#Ring!"
With Twitter poised to be flush with new cash, industry analysts are turning their attention t o how company executives might use the money.
While some analysts say Twitter will build up its infrastructure and invest in mobile and video technologies, they also say this influx of money also means that Twitter will become an even tougher competitor for Facebook, Instagram and Google+.
Twitter CEO, Dick Costolo, in an an interview on CNBC this morning, said he was please with the IPO launch. "I really wouldn't change anything about the way we've approached the process this time," he said. "I think that the team has just done a tremendous job preparing... for everything we were going to go through, and being thoughtful, and methodical about everything we've done along the way."
He also sight to calm concerns that Twitter has not yet made a profit.
"Well, I'll start off by saying there's nothing structural about Twitter that prevents us from having the kind of margin profiles of our peer group," Costolo said. "We have a significant number of investments we want to make as we move down that path, investments in our distributed platform, investment in our Twitter and TV strategy... We will continue to make those investments in the growth of the core business for the foreseeable future."
Sharon Gaudin covers the Internet and Web 2.0, emerging technologies, and desktop and laptop chips for Computerworld. Follow Sharon on Twitter at @sgaudin, on Google+ or subscribe to Sharon's RSS feed. Her email address is firstname.lastname@example.org.
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