Google along with several other tech companies have expressed interest in buying Twitter. You may have not realized that Twitter is offering itself for sale possibly if the right bidder comes along.
Now Google along with some other interesting companies have expressed interest other ones include Salesforce most notably a big cloud computing company that is known for buying up other companies.
We also have word that possibly Apple, Microsoft even facebook had said they might want to buy the company but there have been no formal bids just yet.
You might be wondering how much twitter is worth well some sources have said that the sale price could be upwards of thirty billion dollars and that is interesting because the market cap of Twitter all the total stock sales are about 16 billion so obviously a lot of people think the twitter is worth way more than it looks on paper.
Obviously it’s no surprise yes Google could definitely afford to buy twitter if they wanted it.
Salesforce on the other hand which has really come up multiple times as the other big bidder might not be able to buy it.
Salesforce is about a 50 billion dollar company. So it might be hard to swing that for a 50 billion dollar company to buy 30 billion dollar purchase might not happen so Google might be the only company that makes a real bid if the other companies are necessarily really interested like Apple Facebook although we think they would at least take a look.
It’s safe to say though that if Google wants Twitter they will get it.
Last quarter alone Google made about 21 billion dollars in revenue so a 30 billion dollar purchase probably wouldn’t be that big of a deal.
Also YouTube recently launched their YouTube community features so it would make sense to buy Twitter and bolster some of those community feature sets.
Another thing that someone buying Twitter would have to consider is that Twitter is not a profitable company.
Twitter is losing money like it’s nobody’s business so last quarter alone if you look at the income statement they lost about a hundred seven million dollars, net income was negative the balance sheet just shows all negative red numbers and last year it says they lost about five hundred million dollars.
So anyone that wanted to buy Twitter would not only have to pay up that 30 Billion up front but also eat the cost of holding the company just having it run at about negative 500 million dollars a year according to the most recent income statement.
Now you do have to consider that Google has already been doing this for YouTube so it’s possible they would do this for Twitter.
Google if you didn’t know has been running YouTube at a loss for a long time basically ever since they bought it and YouTube to this day as far as we know is not profitable.
Google has been just running it, hoping it would turn a profit eventually and while it has been going up in revenue they’ve been saying it as far as we know is not profitable yet so Google if anyone would be able to handle a company like this and hold it afloat until it turns profitable.
Also you might consider that Google has its huge ad network which might be able to monetize Twitter better than twitter has been able to do it itself.
Google with 21 billion dollars in revenue last quarter not bad and if they put that on twitter you might be able to see more people buying ads on twitter if they know it’s going to be through that quality Google ad network because we think google has been in the game long enough where they’re pretty good at ads and Twitter seems to just not be that great at it.
Regardless of what you think though the stock market at least did like the news that Twitter could be bought out by especially Google because the stock price jumped about fifteen percent the same day was announced so that is a huge jump you can see the spike although it is still significantly less than after Twitter’s IPO.
So we think it would be fine if Google bought Twitter really it might be good and we’ll just have to wait and see.