May 1, 2017 / 5:44 PM / 5 months ago

Twitter shares rise after report on deal with Bloomberg

FILE PHOTO: The Twitter logo is displayed on a screen on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., September 28, 2016. REUTERS/Brendan McDermid/File Photo

(Reuters) - Twitter Inc’s shares rose 6 percent on Monday after a report that the company is partnering with Bloomberg LP for streaming news, marking the stock’s third straight day of gains following strong results last week.

Twitter and Bloomberg Media will create a service that will stream news produced solely for Twitter, the Wall Street Journal reported.

“(The share movement) is solely because of the Bloomberg partnership. There will be exclusive content streaming on Twitter, and that’s innovative. The market appears to like that,” said Wedbush Securities analyst Michael Pachter.

Twitter reported its strongest user growth in over a year last week. Chief Executive Jack Dorsey cited technical changes to Twitter’s timeline as one of the reasons for the growth.

The microblogging service’s user growth had stalled in the past few quarters, prompting the company to take steps to attract subscribers and advertisers alike.

“There is a steady string of positive news on Twitter that is changing the narrative. And as the narrative improves, it makes that much easier for the advertisers to have comfort with the platform,” Richard Greenfield from BTIG said.

Twitter received a setback last month when it lost a deal to live stream NFL games this year to Amazon.com Inc.

CFRA analyst Scott Kessler said the Bloomberg deal could allay some investor concerns following the loss of the NFL deal and the prospects of live video, a big focus area for Twitter.

“I think a lot of people wondered how (Twitter) is going to fill up that hole and what does that say about the future of live video,” Kessler said.

Twitter and Bloomberg were not immediately available for comment.

Dorsey snapped up more than half a million of the company’s shares for about $9.5 million, according to a filing on Friday.

Twitter was abuzz with takeover chatter last year involving big names such as Salesforce.com Inc and Walt Disney Co. The rumors died down due to the lack of concrete offers.

Including Monday’s gains, Twitter’s shares are now up 6.8 percent so far this year. The stock had lost about 30 percent of its value in 2016.

Reporting by Rishika Sadam in Bengaluru; Editing by Saumyadeb Chakrabarty

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