Shares in the company, which have soared as high as $69 a share, fell 6 per cent on Thursday to below the $26 initial public offer price when Twitter floated in November 2013. According to The Guardian, the company’s market value has collapsed from a high of $41.5bn to just $17.6bn on Thursday.
Twitter has been under intense pressure for the last few weeks after Jack Dorsey, co-founder and interim chief executive officer, said the company’s recent performance had been unacceptable and it would take a long time to turn round the slowdown in user growth.
At the end of last month, Twitter reported the slowest user growth – from 302 million to 304 million active monthly users – since it went public. Dorsey, who has not confirmed when a permanent CEO will be installed to replace ousted former boss Dick Costolo, told investors that the slowing growth was “unacceptable and we’re not happy about it”.
At the time of its IPO, Twitter was heralded as having the potential to become the next Facebook. But while Twitter’s new user growth has stagnated Facebook has continued to add users – up 13 per cent last year to 1.49 billion, which is equivalent to half the world’s online population.
Among investors selling Twitter stock have been the US’s smartest colleges. Harvard, Yale and Stanford universities have all sold big chunks of their Twitter stock in recent weeks.
Yale University, which has a $23.9bn endowment fund, sold all of its 34,345 shares in Twitter – worth just under $1m at Monday’s stock price – over the last quarter. Harvard, the world’s wealthiest university with a $36.4bn fund, sold 29,856 Twitter shares between April and June. Stanford, which has an endowment fund worth $21.4bn, sold 18,000 shares.
