Twitter CFO Says Investing In Crypto “Makes No Sense Right Now”

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Investing some of Twitter Inc.’s corporate money in crypto assets such as bitcoin “doesn’t make sense right now,” CFO Ned Segal said in an interview on Monday.

“We [would] have to change our investment policy and choose to hold more volatile assets, ”Segal said, adding that the company prefers to hold less volatile assets such as securities on its balance sheet.

Twitter reported $ 3.47 billion in cash and cash equivalents at the end of September, up from $ 1.99 billion in the previous year period, along with short-term investments of $ 3.94 billion. of dollars.

Mr Segal echoed a common concern among CFOs, many of whom cite the volatility of currencies and digital assets as one of the reasons they don’t use them for their business investments.

The lack of specific accounting rules for these assets also complicates matters for CFOs. In recent months, major U.S. companies have urged the Financial Accounting Standards Board to write rules on how to deal with crypto assets.

There are exceptions such as Tesla Inc. and Square Inc., the payments company run by Jack Dorsey, who is also the chief executive of Twitter. Both companies have revealed that they hold crypto assets.

“We bought bitcoin for our own balance sheet, which we believe not only shows that we have our skin in the game… but could also offer attractive long-term financial benefits,” Square CFO said, Amrita Ahuja, in an interview last month.

Twitter’s Mr Segal, who has headed the company’s finance function since 2017, said earlier this year that the company had researched the use of bitcoin. “There is a different set of decisions that we would have to make if we were to own cryptocurrencies on our balance sheet,” Segal said on Monday.

Twitter sees growth potential for its recently launched subscription services, Mr. Segal said. Subscriptions “will be a predictable new open space for us to generate additional revenue,” Segal said, pointing to services such as Twitter Blue, which gives users additional features, and Super Follows, which allows users to bill subscribers and provide access to additional content.

Twitter Blue, which currently costs $ 2.99 per month, is a “great place to start experimenting with new features,” Segal said. The company is currently listing its subscription revenue as part of its data licenses and other revenue, which generated $ 143. million euros during the quarter ended September 30, up 12% compared to the same period a year earlier.

Going forward, Twitter will offer subscriptions at different prices, Mr. Segal said. However, the majority of the company’s overall revenue, targeted at $ 7.5 billion in 2023, will come from advertising, Segal said.

Twitter, which announced last month that it would sell its mobile advertising company MoPub to AppLovin Corp. for $ 1.05 billion, will remain vested and use part of the proceeds of that deal to pay down debt and buy back shares, he said. Threader, an app that compiles and shares discussion threads, announced Monday that it had been acquired by Twitter for an undisclosed amount.

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