In Just Five Days, Meta's Threads Passes 100 Million Users, Increasing Stock

As its new social media network, Threads, drew over 100 million users in just five days of its launch, Meta Platforms, formerly known as Facebook, saw a big increase in the price of its stock. Investors and business experts are both interested in Threads due to its rapid growth rate, which has led to comparisons to Twitter frequently.

The happy news was announced on Monday by CEO Mark Zuckerberg, who noted that the remarkable number of sign-ups was primarily generated by organic demand, without the need for intensive promotional activities. The platform's promotional potential has not yet been completely realized by Meta, suggesting additional growth potential.
According to data from Quiver Quantitative published on Monday, Threads achieved the 100 million milestone, making it one of the fastest-growing apps of its kind. In comparison, it took OpenAI’s ChatGPT, supported in part by Microsoft, nearly two months to reach the same milestone.

The market responded positively to this news, with Meta’s stock rising by 1% in early Monday trading, while the Nasdaq experienced a minor decline of 0.21%. Meta shares were valued at $293.24 each, reflecting the enthusiasm surrounding Threads’ success.

Threads is not anticipated to have an immediate effect on Meta's revenue, despite the quick user growth and media attention it has received. However, according to Justine Patterson of KeyBanc Capital Markets, Threads, which already accounts for about one-third of Twitter's active user population, may bring in between $800 million to $6.7 billion in income for Meta by 2024.

The European Digital Markets Act regulations have presented Meta with regulatory difficulties and prevented the introduction of Threads in the European Union. The business is unlikely to contest this restriction given Meta's recent legal defeats over the management of user data for targeted advertising.

CFRA senior equity analyst Angelo Zino believes that despite the exclusion from the EU initially, the growth of Threads is expected to be exponential in the coming months. Zino maintains a positive outlook on Meta’s stock, holding a ‘buy’ rating with a $350 price target.

The launch of Threads followed controversial changes made to the Twitter platform, including limitations on the number of tweets users can see daily. These changes were implemented by Elon Musk, Twitter’s controlling owner, in an effort to combat data scraping and system manipulation on the microblogging website.

New Twitter CEO Linda Yaccarino, who joined the company from NBCUniversal, expressed the need for significant changes to strengthen the platform. Meta, on the other hand, has capitalized on its vast user base of 3 billion across platforms like Facebook, Instagram, and WhatsApp to fuel the growth of Threads.

In conclusion, Meta's Threads has had a successful launch, drawing more than 100 million users in just five days. Though an immediate economic impact is not anticipated, Meta's user base and the success of Threads hold hope for the social media behemoth. Analysts and investors continue to be upbeat about the platform's capacity for growth and its capacity to diversify Meta's revenue sources.

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