Connect with us

Published

on

In this photo illustration, former U.S. President Donald Trump’s archived Twitter account is shown on a phone screen with the Twitter logo in the background.

Sheldon Cooper | Lightrocket | Getty Images

A decade ago, Twitter’s future was looking bright. The company was benefiting from a flood of funding into the social-networking space, eventually leading to an IPO in 2013 that raised $1.8 billion.

Now the company is back in private hands. And they happen to be the hands of Elon Musk, the richest person in the world and one of the app’s most high-profile provocateurs.

It’s a massive moment. Twitter has become a key place for people to debate, joke and pontificate in their own circles of politics, sports, tech and finance. It’s also served as a platform that gives voice to the voiceless, helping protesters organize and express themselves in repressed regimes around the world.

In recent years, however, Twitter and social media rivals like Facebook have been at the center of controversy over the distribution of fake news and misinformation, sometimes leading to bullying and violence.

Investors had grown concerned about Twitter as a business. The company was generally unprofitable, struggled to keep pace with Google and Facebook, and often killed popular products with no real explanation.

What follows is a brief history of Twitter, which — despite its many flaws — is one of the most iconic companies to come out of Silicon Valley in the past 20 years.

2006

In March, Jack Dorsey, Noah Glass, Biz Stone, and Evan Williams created Twitter, which was originally a side project stemming from the podcasting tool Odeo. That month, Dorsey would send the first Tweet that read, “just setting up my twttr.”

2007

In July, Twitter received a $100,000 Series A funding round led by Union Square Ventures. The app’s popularity started to explode after being heavily promoted by the tech community during the annual South by Southwest conference.

2008

Dorsey stepped down as CEO in October, and was replaced by Williams. According to the book “Hatching Twitter” by journalist Nick Bilton, Twitter’s board fired Dorsey over concerns about the executive’s management style and public boastings.

2009

Twitter’s popularity continued to soar, leading to a high-profile appearance from Williams on Oprah Winfrey’s talk show alongside celebrity Ashton Kutcher. Kutcher would also write about Williams and Stone as part of Time Magazine’s Time 100 issue. Twitter was now a mainstream phenomenon.

2010

Twitter reached space, with NASA Astronaut Timothy Creamer sending the first tweet live from outer orbit. Behind the scenes, however, management woes continued with Williams stepping down as CEO, replaced by operating chief Dick Costolo.

2011

Twitter became an essential social media tool used during the Arab Spring, the wave of antigovernmental protests throughout Egypt, Libya and Tunisia. Protesters used the site to post reports and to organize. As the Pew Research Center noted, Twitter’s role in “disseminating breaking news” was not “not limited to the Arab uprisings – the death of Whitney Houston, for example, was announced on Twitter 55 minutes prior to the AP confirming the story.”

2012

Twitter’s reach expanded to 200 million active users. Barack Obama used the “platform to first declare victory publicly in the 2012 U.S. presidential election, with a Tweet that was viewed approximately 25 million times on our platform and widely distributed offline in print and broadcast media,” according to corporate filings.

2013

Twitter went public in November. The combined wealth of Williams, Dorsey, and Costolo hit roughly $4 billion.

“I think we’ve got a tremendous set of thoughts and strategies to increase the slope of the growth curve,” Costolo told CNBC at the time. “I would consider some of them tactics, some of them broader strategies, in service of doing what I referred to as bridge the gap between the massive awareness of Twitter and deep engagement of the platform.”

Twitter CEO: Nothing prevents us from achieving margins of peers

2014

Slowing user growth led to several stock drops and analyst downgrades. Twitter also deemed 2014 the year of the “selfie.”

2015

Compared to rivals like Google, Facebook, and even LinkedIn, Twitter was starting to look like the runt of the Internet litter. Twitter was still unprofitable as its ad business struggled mightily against its larger competitors. Dorsey would also return as CEO of the company, while still maintaining the top job at his other company, Square (now Block).

2016

Rumors began circulating that Twitter was looking to be acquired, with Salesforce as a potential suitor. Meanwhile, Twitter and Facebook were criticized for their role in letting prominent users like Donald Trump, who would win the U.S. presidential election that year, spread misleading information without consequence.

“Having the president-elect on our service using it as a direct line of communication allows everyone to see what is on his mind in the moment,” Dorsey said at the time. “We’re definitely entering a new world where everything is on the surface and we can all see that in real time and we can have conversations about it.”

2017

For a moment, Twitter appeared to be on the upswing. Its stock was finally trending upward as the company’s finances were improving. Meanwhile, Trump as president continued to use Twitter as his megaphone. According to Twitter’s own data, “Trump was the most-tweeted-about global leader in the world and in the United States” that year, CNBC reported.

2018

Dorsey and Facebook’s then-operating chief Sheryl Sandberg testified before the Senate Intelligence Committee about alleged interference by Russia-linked actors in the 2016 election. Trump and fellow Republicans became increasingly vocal about alleged political bias by Twitter and other social media sites.

“In fact, from a simple business perspective and to serve the public conversation, Twitter is incentivized to keep all voices on the platform,” Dorsey said at the time.

2019

Analysts found correlations between President Trump’s voracious use of Twitter and various markets, including gold, underscoring the cultural power of Twitter. Trump met with Dorsey — a Twitter spokesperson said “Jack had a constructive meeting with the President of the United States today at the president’s invitation.”

“They discussed Twitter’s commitment to protecting the health of the public conversation ahead of the 2020 U.S. elections and efforts underway to respond to the opioid crisis,” the spokesperson said.

2020

As Covid-19 spread across the globe, the spread of misinformation dominated the online conversation. And Twitter continued to struggle to grow its business. The service was also hacked that year, and miscreants gained access to over a dozen high-profile accounts, including those controlled by Joe Biden, Jeff Bezos, and Musk

2021

Twitter permanently banned Trump over inflammatory comments the president made during the U.S. Capitol riots in January that the company said could lead to “further incitement of violence.” Trump would allege that Twitter workers “coordinated with the Democrats and the Radical Left in removing my account from their platform, to silence me.” Later, Dorsey suddenly stepped down as CEO and was replaced by Parag Agrawal, the company’s chief technology officer.

2022

Musk took over Twitter after a protracted legal spat that would have culminated this week in a trial in Delaware’s Court of Chancery. The Tesla CEO agreed in April to pay $44 billion for Twitter, but then attempted to renege on the deal. He changed course and opted to proceed, walking into the company’s San Francisco office on Wednesday with what appeared to be a porcelain bathroom sink in his hands.

“Entering Twitter HQ – let that sink in!” he tweeted, with a video of his entrance.

Musk immediately began making changes, firing Agrawal, finance head Ned Segal, and head of legal policy Vijaya Gadde.

WATCH: Billionaire Elon Musk steps into Twitter HQ, sink in hand

Billionaire Elon Musk steps into Twitter HQ, sink in hand

Continue Reading

Technology

Alphabet jumps 3% as search, advertising units show resilient growth

Published

on

By

Alphabet jumps 3% as search, advertising units show resilient growth

Alphabet CEO Sundar Pichai during the Google I/O developers conference in Mountain View, California, on May 10, 2023.

David Paul Morris | Bloomberg | Getty Images

Alphabet‘s stock gained 3% Friday after signaling strong growth in its search and advertising businesses amid a competitive artificial intelligence environment and uncertain macro backdrop.

GOOGL‘s pace of GenAI product roll-out is accelerating with multiple encouraging signals,” wrote Morgan Stanley‘s Brian Nowak. “Macro uncertainty still exists but we remain [overweight] given GOOGL’s still strong relative position and improving pace of GenAI enabled product roll-out.”

The search giant posted earnings of $2.81 per share on $90.23 billion in revenues. That topped the $89.12 billion in sales and $2.01 in EPS expected by LSEG analysts. Revenues grew 12% year-over-year and ahead of the 10% anticipated by Wall Street.

Net income rose 46% to $34.54 billion, or $2.81 per share. That’s up from $23.66 billion, or $1.89 per share, in the year-ago period. Alphabet said the figure included $8 billion in unrealized gains on its nonmarketable equity securities connected to its investment in a private company.

Adjusted earnings, excluding that gain, were $2.27 per share, according to LSEG, and topped analyst expectations.

Read more CNBC tech news

Alphabet shares have pulled back about 16% this year as it battles volatility spurred by mounting trade war fears and worries that President Donald Trump‘s tariffs could crush the global economy. That would make it more difficult for Alphabet to potentially acquire infrastructure for data centers powering AI models as it faces off against competitors such as OpenAI and Anthropic to develop largely language models.

During Thursday’s call with investors, Alphabet suggested that it’s too soon to tally the total impact of tariffs. However, Google’s business chief Philipp Schindler said that ending the de minimis trade exemption in May, which created a loophole benefitting many Chinese e-commerce retailers, could create a “slight headwind” for the company’s ads business, specifically in the Asia-Pacific region. The loophole allows shipments under $800 to come into the U.S. duty-free.

Despite this backdrop, Alphabet showed steady growth in its advertising and search business, reporting $66.89 billion in revenues for its advertising unit. That reflected 8.5% growth from the year-ago period. The company reported $8.93 billion in advertising revenue for its YouTube business, shy of an $8.97 billion estimate from StreetAccount.

Alphabet’s “Search and other” unit rose 9.8% to $50.7 billion, up from $46.16 billion last year. The company said that its AI Overviews tool used in its Google search results page has accumulated 1.5 billion monthly users from a billion in October.

Bank of America analyst Justin Post said that Wall Street is underestimating the upside potential and “monetization ramp” from this tool and cloud demand fueled by AI.

“The strong 1Q search performance, along with constructive comments on Gemini [large language model] performance and [AI Overviews] adoption could help alleviate some investor concerns on AI competition,” Post wrote in a note.

WATCH: Gemini delivering well for Google, says Check Capital’s Chris Ballard

Gemini delivering well for Google, says Check Capital's Chris Ballard

CNBC’s Jennifer Elias contributed to this report.

Continue Reading

Technology

Amazon sellers raise prices after Trump’s China tariff: ‘It’s unsustainable’

Published

on

By

Amazon sellers raise prices after Trump's China tariff: 'It's unsustainable'

An Amazon employee works to fulfill same-day orders during Cyber Monday, one of the company’s busiest days at an Amazon fulfillment center on December 2, 2024 in Orlando, Florida. 

Miguel J. Rodriguez Carrillo | Getty Images

For 10 years, Aaron Cordovez has been selling kitchen appliances on Amazon. Now he’s in a bind, because most of his products are manufactured in China.

Cordovez, co-founder of Zulay Kitchen, said his company is moving “as fast as we can” to move production to India, Mexico and other markets, where tariffs are increasing under President Donald Trump, but are mild compared with the levies imposed on goods from China. That process will likely take at least a year or two to complete, he said.

“We’re making our inventory last as long as we can,” Cordovez said in an email.

Zulay is also temporarily raising the price of some of its milk frothers, smores roasting sticks and other products. The company’s popular kitchen strainer now costs $12.99, up from $9.99 before Trump announced his sweeping tariff proposal earlier this month.

Amazon merchants are hiking prices for everything from diaper bags and refrigerator magnets to charm necklaces and other top-selling items as they confront higher import costs. E-commerce software company SmartScout tracked 930 products on Amazon that have seen increased prices since April 9, with an average jump of 29%.

The price hikes affect a range of categories, including clothing, jewelry, household items, office supplies, electronics and toys.

The trade war with China has threatened to upend sellers on Amazon’s third-party marketplace, which accounts for about 60% of the company’s online sales. Many merchants are based in China or rely on the world’s second-largest economy to source and assemble their products.

Sellers are now faced with the conundrum of raising prices or eating the extra costs associated with Trump’s new tariffs. It’s an existential threat for many sellers, who subsist on razor-thin margins and have, for the last several years, dealt with rising costs on Amazon tied to storage, fulfillment, shipping and advertising fees along with pricing pressure from increased competition.

CEO Andy Jassy told CNBC earlier this month that the company was “going to try and do everything we can” to keep prices low for shoppers, including renegotiating terms with some of its suppliers. But he acknowledged some third-party sellers will “need to pass that cost” of tariffs on to consumers.

Amazon’s stock price is down 15% so far this year, sliding along with the broader market. The company reports first-quarter earnings next week.

Watch CNBC's full interview with Amazon CEO Andy Jassy

Goods imported from China now face import duties of 145%, though Trump said Wednesday his administration is “actively” talking with China about a potential deal to lower tariffs. Chinese officials on Thursday denied that trade talks are taking place.

About 25% of the price increases observed by SmartScout were initiated by sellers based in China, said Scott Needham, the company’s CEO. Last week, stainless steel jewelry maker Ursteel hiked prices on four of its products by $6.50, while apparel brand Chouyatou raised the price of some of its dresses by $2. Both businesses are based in China’s Zhejiang province.

Anker, a Chinese electronics brand and one of Amazon’s largest sellers, has raised prices on one-fifth of its products sold in the U.S., including a portable power bank, which went up to $135 from $110, SmartScout data shows.

Representatives from Anker, Ursteel and Chouyatou didn’t respond to requests for comment.

Zulay, headquartered in Florida, is one of many U.S.-based sellers raising prices. The company is also cutting costs. Cordovez said he’s been forced to lay off 19% of his workforce and slash online ad spending by 85%.

Desert Cactus, based in Illinois, is also taking action. Joe Stefani, the company’s president, has been looking to move production of some of his brand’s college-themed merchandise out of China and into Mexico, India and Vietnam. About half of Desert Cactus’ goods come from China, while the rest are made in the U.S., Stefani said.

An Amazon worker moves a cart filled with packages at an Amazon delivery station in Alpharetta, Georgia, on Nov. 28, 2022.

Justin Sullivan | Getty Images

One of the company’s top products is a customizable license plate frame that’s manufactured in China. At the start of Trump’s first term in 2016, Stefani’s company paid import and shipping fees of 4% on the license plates. That rate has since skyrocketed to 170%, he said.

“The tariffs can’t stay this high,” Stefani said. “There’s so many people that just aren’t going to make it.”

Stefani said he expects Desert Cactus will end up raising prices on some products, though he’s worried shoppers might be put off by sticker shock.

“Will someone be willing to pay $50 for a hat on Amazon?” Stefani said. “You know it’s going to be expensive at the ballpark, but on Amazon we don’t know.”

Dave Dama, co-founder of health and beauty business Pure Daily Care, said the price to manufacture one of his skin-care products in China jumped to $25 from $10. Most Amazon sellers will have no choice but to raise prices, he said.

“If you were selling something for $40 and making a $7 or $8 profit at the end of the day, with these tariffs, those days are gone,” Dama said. “You can’t do that anymore. It’s unsustainable.”

Pure Daily Care plans to stagger price increases over several weeks, and only on products “we absolutely need to,” to keep Amazon’s algorithms from ranking it lower in search results or losing the valuable buy box, he said. The buy box determines which listing pops up first when a shopper clicks on a particular product, and the one that gets purchased when they tap “Add to Cart.”

An Amazon spokesperson said the company’s pricing policies continue to apply.

“As always, sellers set their own prices, and we regularly monitor how we highlight great prices as Featured Offers to provide customers with low prices across a wide selection,” the spokesperson said in a statement.

Dama said his company has enough inventory for some products to last up to six months, which it aims to “stretch as long as possible” in the hope that China and the U.S. can reach a trade deal. The company is also forgoing some sales promotions and discounts, while pausing spend on some display and video ads.

Regarding his inventory, Dama said, “We can try to stretch that seven, eight, nine months, which buys us a lot more time for this thing to work out, hopefully.”

Don’t miss these insights from CNBC PRO

Trump tariffs are raising prices on Amazon and threatening to ruin U.S. sellers who source in China

Continue Reading

Technology

Pony.ai teams up with Tencent for robotaxi services on WeChat, other apps

Published

on

By

Pony.ai teams up with Tencent for robotaxi services on WeChat, other apps

A Pony.ai autonomous car.

Pony.ai

Chinese start-up Pony.ai said Friday it will develop autonomous driving technology in partnership with Tencent Cloud and deploy robotaxi services on tech giant Tencent’s WeChat and other applications.

The Nasdaq-listed company which specializes in autonomous vehicle technology, particularly robotaxis and robotrucks, said in a press release that the deal will include cooperation in areas such as cloud services, map data, information security and intelligent cockpit ecosystems.

The arrangement will also see the two companies integrate Pony.ai’s robotaxi ride-hailing services within Tencent’s popular WeChat app as well as other applications like Tencent Maps. 

Both companies had been in talks “for quite some time,” Pony.ai CEO James Peng told CNBC on the sidelines of the Shanghai Auto Show on Friday. He cited Tencent’s huge user base and its cloud offerings as factors supporting the “win-win” collaboration as the start-up continues to scale up.

Following the partnership, Peng said that “hopefully in the near future,” users would be able to call Pony.ai robotaxi rides straight through the WeChat app.

WeChat is known as the world’s most popular ‘super app,’ housing everything from messaging to payment transactions to food delivery services, with a monthly user base of over 1 billion people.

“Pony.ai possesses industry-leading autonomous driving technology accumulations, while Tencent excels in cloud services, mapping, and cockpit ecosystem technologies,” Vice President of Tencent Group and President of Tencent Smart Mobility Zhong Xiangping was quoted as saying in the Friday release. 

“This strategic partnership between the two parties is not only about complementing each other’s technologies and resources but also marks a new starting point for collaborative innovation,” he added. 

Ordering a robotaxi ride on WeChat may soon be possible, says Pony.ai CEO

The release said that the partnership would also see both companies collaborate on the development, testing, and operation of Robotaxis, particularly in L4-level autonomous driving.

According to SAE International, L4 is a type of autonomous driving that allows drivers to take their eyes off the road in designated areas. For comparison, L3 is considered a hands-off system, but drivers must actively monitor the vehicle and be ready to take over the wheel.

The Tencent Cloud agreement comes a day after it was reported that Pony.ai unveiled its L4, seventh-generation robotaxi solution at the Shanghai Auto Show on Wednesday. The company’s shares surged about 40% in the U.S. on Thursday. 

The start-up continues to establish itself as a prominent player in China’s autonomous driving industry. The company obtained China’s first permit to charge fares for fully driverless taxis in core parts of a business district of Shenzhen, where Tencent is headquartered. 

However, the firm may be implicated in increasing trade tensions between China and the U.S. as the latter is a market Pony.ai considers “hugely important” to its expansion plans.

James Peng, co-founder and chief executive of Pony.ai this week reportedly told the Financial Times that the company is considering a secondary listing outside the U.S. amid mounting concerns that Washington will push for the delisting of Chinese companies off the New York Stock Exchange. 

If this were to happen, it would come less than six months after the company’s initial public offering in the U.S. Notwithstanding, Peng told FT that a lot of factors need to be considered.

Continue Reading

Trending