Has Twitter (TWTR) stock captured your attention recently? Maybe as one of the few tech stocks trading close to its 52-week low as the market races higher, it has jumped out to you as a possible buying opportunity.
If Twitter is new to your watchlist, or if you're not very familiar with the company, you may find some of these facts both interesting and enlightening.
Image source: Getty Images.
1. Jack Dorsey was fired in 2008.
Twitter's CEO today, Jack Dorsey, spent years away from Twitter before he returned in 2015. Though he co-founded Twitter and became the company's CEO early on, Dorsey was forced out of the company in 2008.
"While the board of directors and the company have nothing but praise for where Jack has taken us, we also agree that the best way forward is for Jack to step into the role Chairman, and for me to become CEO," wrote Twitter co-founder Evan Williams as he took the reins as CEO in 2008. "Jack will remain on the board and be closely consulted for all strategic decisions, while I take on day-to-day operations..."
2. Dorsey is also the CEO of Square.
In a dual-CEO role only attempted by a few souls, including Tesla and SpaceX's Elon Musk, Dorsey splits his time leading two major companies: Twitter and publicly traded Square (SQ 3.45%).
3. The board initially didn't want Dorsey back unless he came to Twitter full-time.
A few weeks after bringing Dorsey back to Twitter in an interim CEO position in June 2015, Twitter's board made it clear in a press release that Dorsey wouldn't be considered for the permanent CEO position if he wanted to keep his CEO position at Square. "The Committee will only consider candidates for recommendation to the full Board who are in a position to make a full-time commitment to Twitter."
But Twitter eventually relented and hired Dorsey, allowing him to continue leading Square.
4. Twitter stock has plummeted since Dorsey returned.
Since Dorsey returned to run Twitter in June 2015, the stock's performance has been dismal, falling 55%.
Interestingly, Dorsey's Square has seen its stock skyrocket in the meantime, up 90% since its late 2015 IPO.
5. Twitter's daily active users are climbing nicely.
After Twitter's second-quarter earnings report, lots of attention was given to the company's inability to grow its monthly active users sequentially. Even on a year-over-year basis, monthly active users were up just 5%.
But Twitter's daily active users (DAUs) continued to grow at a healthy rate in Q2, up 12% year over year. Further, Twitter chief operating officer Anthony Noto importantly said during Twitter's second-quarter earnings call that daily active user growth was driven by various geographic markets: "The growth was broad based with double-digit growth increases for DAU in 5 of our top 10 markets, as well as those markets outside of the top 10 also grew double digits."
6. Twitter's advertising business isn't its most profitable segment.
Data licensing, which accounted for about 15% of Twitter's second-quarter revenue, is far more lucrative than Twitter's advertising sales. Indeed, Twitter noted in its most recent earnings call that $1 of data revenue is equal to approximately $3 to $4 of advertising revenue, thanks to its substantially higher profitability.
Twitter's data-licensing business stood out in the company's second-quarter results, with its revenue increasing 26% year over year, while advertising revenue fell 8% year over year. The segment's accelerating growth in the last two quarters reflects revitalized efforts in the segment, including improved strategies and more aggressive selling, management explained in its second-quarter conference call.
Twitter headquarters. Image source: Twitter.
A quick review of these easy-to-overlook facts about Twitter reveals a dramatic history and an interesting business. Going forward, investors will look for the company to find new ways to return to overall revenue growth, hopefully making Dorsey's return to Twitter start to seem worthwhile.
