Facebook’s $1 billion acquisition
of Instagram in 2012 may have seemed shocking at the time -- and
indeed, it sparked talk of a new tech bubble. But as it turns out the
deal is now looking like quite a bargain for the social network. Not
only has it kept it at the forefront of photo sharing, a new valuation
estimate for the service puts its worth at a whopping $35 billion.
The new estimate comes courtesy of Citigroup, which previously had
the company valued at an already impressive $19 billion. The increased
value is related to Instagram's announcement last week that it now has
over 300 million active monthly users and growing faster than expected.
While Citi's analysts acknowledge the $35 billion valuation is
speculative at this point and dependent on several factors, their
optimism is based on the fact Instagram is undermonetized. Citigroup
believes that Instagram could eventually contribute around $2 billion in
annual revenue for Facebook.
The photo sharing app was recently updated with new filters and
features, while today the company took steps towards cleaning up spam
accounts. It’s said Justin Bieber lost 3.5 million ‘believers’ in the
purge. Oh, the humanity.
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