Shares open up 73%, giving social company market cap of more than $31 billion
Twitter shares opened at $45.10 per share — 73% over its initial public offering price — as investors clamored to get a piece of the as-yet unprofitable social company’s business.
Twitter shares began trading at about 10:50 a.m. Thursday on the New York Stock Exchange, under the symbol “TWTR.” The exchange delayed Twitter trading in order to process orders received ahead of the bell.
In the first hour of trading, Twitter shares rose as high as $50.09 per share before dropping back to $45.26.
Twitter on Wednesday raised pricing for 70 million shares of common stock to $26 each, which valued the company at more than $14 billion. Based on the opening stock price, the company is worth more than $31 billion. Twitter will raise $1.8 billion with the offering.
Founded in 2006, Twitter has been in investment mode and remains in the red. Twitter reported $168.6 million in revenue for the third quarter of 2013, more than double the year-earlier period, but also disclosed its biggest net loss to date, of $64.6 million.
Twitter’s monthly active user based climbed to an average of 231.7 million for the quarter ended Sept. 30, up 6% from 218.3 million the previous quarter. Of those, Twitter said it estimates less than 5% are “false or spam accounts” although it acknowledged the estimate may be low.
Twitter is about one-fourth the size of its chief rival, Facebook, which has more than 1 billion active users worldwide. The Twitter offering is the biggest tech IPO since Facebook’s bumpy initial offering 18 months ago on Nasdaq that suffered trading glitches. Facebook stock lost half its value in three months, before rebounding this summer on strong mobile growth.