A fake Twitter story proved to be beneficial for Twitter?s Stock Market standing as it sent shares soaring yesterday, giving a temporary reprieve for the social media company that has been struggling from controversies early in the year.
According to reports, a fake story from ?Bloomberg? disclosed that someone made a bid to buy Twitter for $31 Billion ? causing stocks to rise by almost 8% immediately. Of course, the stocks dropped as soon as the fake news broke out, but Twitter shares remained 3% higher compared to the day before.
Fake Bloomberg Story Boosts Twitter
According to Recode, the bogus report, headlined ?Twitter Attracts Suitors? and?attributed to Bloomberg News, said Twitter received?a $31 billion buyout offer, a clever ploy to goose the company?s shares.
The hoax?was artfully?deployed,?appearing on a forged?website found?at bloomberg.market with?a post designed to look exactly like a Bloomberg article. The fake news story?keyed into one possible scenario for the troubled tech company, causing some investors to believe it had received an actual buyout bid. Twitter?s?current market value is just under $25 billion.
Discrepancies in the report
However, there were some dubious details that were immediately caught by media experts. Recode further mentioned that Bloomberg News would never run such a fuzzy headline, especially one based on anonymous sourcing. Readers would?ve been better fooled by?something like: ?Twitter Is Said To Hire Advisors on Possible Sale.? The name of former CEO Dick Costolo was misspelled. Corrections are like little nicks of?death at Bloomberg, so a big no-no.?The lead sentence doesn?t immediately describe what Twitter is (a social media company) or?its context (that has struggled lately).?Finally, no nut graph, or what-does-this-all-mean explanation.
Twitter has been on a lot of strain?lately, the most pressing of which is the resignation of its CEO Dick Costolo. Time also reported that though nearly 90% of Twitter?s revenues come from advertising, the company must still prove to Wall Street that ad sales can keep growing over time, and that they must demonstrate to advertisers that its platform is effective at influencing consumers.
Yet in the first three months of 2015, revenue growth fell off sharply as new features encouraging users to take action?by making a phone call or downloading an app?did not provide much lift. The news sent the stock down by 25% in late April.
Bloomberg news on the other hand, reported that the Securities and Exchange Commission is now looking into a possible case of fraud.