Twitter Acquires Scroll and Opens Space To Enhance Communication

Twitter (TWTR) plans to make it easier for people to discover and read whatever is happening in and around the world.

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With its acquisition of Scroll, the microblogging platform hopes to make it easier for publishers, journalists, and writers to connect with readers.

Scroll is a meaningful addition to Twitter’s subscriptions offerings, as the networking giant looks to shape its subscription service. Twitter will integrate Scroll features into its upcoming subscription service to allow people to read articles easily.

Scroll has made a name for itself by allowing people to read articles without contending with ads, pop-ups, and other clutter. Payments from subscribers deliver more revenue to publishers than the blocked ads would have contributed.

In addition, Twitter is making it easy for people with disabilities to access its content. Space is the new live audio conversation service that Twitter is rolling out as part of its strategy to move conversations beyond text. Twitter users who are deaf or hard of hearing can now turn on captions and follow conversations with ease on the app.

Twitter has taken many additional steps to improve its accessibility, including boosting the accuracy and synchronization of captions, and adding scrollback and pause capabilities to its videos. Two internal teams continue to work on making Twitter a more accessible company and product in real-time. (See Twitter stock analysis on TipRanks)

However, Rosenblatt Securities analyst Mark Zgutowicz has warned that Twitter faces the risk of losing some daily active users (DAU) as most of them opt out of ad tracking on iOS.

“While the MAP rebuild was well-intended to fill brand spend gaps outside tent pole events, it can’t overcome the systematic risks Apple policies, and soon Google, will inflict on 1-to-1 ad targeting returns. Of Twitter’s 38M US DAU count, we expect ~10-15M opting out of ads tracking on iOS, further burdening the company’s much needed DR revenue diversification,” Zgutowicz stated in his research note.

The analyst has since reiterated a Hold rating on the stock. He has also cut his price target to $60 from $65, which implies 10.29% upside potential.

Consensus among analysts on Wall Street is that Twitter is a Moderate Buy based on 13 Buys, 21 Holds and 1 Sell rating. The average analyst price target of $71.25 implies 30.97% upside potential to current levels.

TWTR scores a 6 out of 10 on TipRanks’ Smart Score rating system, implying its performance is likely to align with market expectations.