Twitter Sells Ad Unit Mo Pub To AppLovin For $1B: What You Need To KNow

Twitter Inc TWTR said Wednesday it has agreed to sell its MoPub mobile ad unit to AppLovin Corporation APP for $1.05 billion in cash.
What Happened: The Jack Dorsey-led company said the transaction would allow it to hasten the development of owned and operated revenue products and drive growth across key service areas such as performance-based advertising, small and medium-sized business offerings, and commerce initiatives.

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“This transaction increases our focus and demonstrates confidence in our revenue product roadmap, accelerating our ability to invest in the core products that position Twitter for long-term growth and best serve the public conversation,” said Dorsey.

Twitter Chief Financial Officer Ned Segal said the deal would help the company “replenish the near term revenue loss, with the goal of improving our time to market to deliver on our previously stated goal of at least doubling total annual revenue from $3.7 billion in 2020 to $7.5 billion or more in 2023."

Why It Matters: MoPub generated nearly $188 million in annual revenue reported under Data Licensing and Other. 

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Additional details regarding future financial impact would be made available when Twitter reports financial results for the third quarter on Oct. 26.

Under the terms of the agreement, Twitter said it would provide “certain services” to AppLoving for a period of time post-close to enable the orderly transition for publishers and advertisers.

Twitter purchased MoPub for approximately $350 million in 2013, reported Reuters.

Notably, Apple Inc AAPL imposed new privacy notifications in iOS 14.5 that came in the way of digital advertisers such as Facebook Inc FB and Twitter.

Twitter in July said that the impact of such privacy changes was smaller than expected in the second quarter.

Price Action: On Wednesday, Twitter shares closed nearly 2.4% higher at $61.29 in the regular session and rose another almost 2% to $62.50 in the after-hours trading. On the same day, in the after-hours session, Applovin Corp shares shot up nearly 9.5% to $84.30 after closing 4.41% higher at $77 in the regular session.
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