Daily Tech Snippet: Friday February 6

• Twitter Q4 earnings: revenue $479M, +97% Y/Y; net loss narrows to $125M, stock up 11% on monetization success, but user growth continues to fall: Twitter on Thursday said its fourth-quarter revenue increased 97 percent to $479.1 million, with the net loss narrowing to $125.4 million. The San Francisco-based company also projected adding 13 million to 16 million users in the first quarter, up 4.5 percent sequentially -- faster than the 1.4 percent growth in the prior period. The results sent Twitter’s shares soaring in extended trading, adding to gains so far this year that are reversing last year’s 44 percent stock price drop. Chief Executive Officer Costolo, who has been under fire for the company’s slowing user growth and management turbulence, is working to recover investor trust by rolling out new features to attract people to the microblogging site and to rev up advertising revenue. “We know they have the monetization tools to significantly grow the business,” said James Cakmak, an analyst at Monness Crespi Hardt & Co., adding that investors may forgive Twitter for slow user growth because of moves to distribute tweets more widely. “They get a pass this time.” Twitter isn’t out of the woods with investors. The company’s membership growth continues to decelerate year-over-year, even with the forecast for user growth to pick up sequentially in the current quarter. For the fourth quarter, monthly active users increased 20 percent from a year ago to 288 million, compared with 23 percent growth in the prior period. The company said the rollout of a new mobile operating system from Apple Inc. and integration issues cost it 4 million new users. For the first quarter, Twitter projected revenue of $440 million to $450 million, compared with the average analyst estimate of $449.9 million. “He did a great job taking some fairly negative results and putting them in a positive light,” Nate Elliott, an analyst at Forrester Research Inc., said of Costolo. “But the fact is, every quarter they make a big deal about how important it is to grow their user base, and every quarter they fail.” The changes are intended to keep people glued to Twitter’s product for longer. In the fourth quarter, the company said its members viewed their timelines more often, with 182 billion views, compared with 181 billion in the prior quarter. Mobile advertising was 88 percent of total ad revenue in the fourth quarter, Twitter said. International revenue more than doubled.

• Twitters's slowing user engagement is posing existential questions though: Here’s Twitter’s Slowing User Growth In One Chart: The company added a mere 4 million new monthly active users in the quarter, which is an adjustment that it will likely explain on its earnings call. That 4 million figure bumped Twitter’s monthly active user tally up from 284 million in its third quarter, to 288 million in the fourth. Up 20 percent compared to the year-ago quarter, it was a gain of just 1.4 percent on a sequential-quarter basis. Here’s the carnage: Twitter is still growing, but that final figure is dangerously close to zero. And if Twitter actually stops growing, even for a quarter, and shrinks, expect investors to release holy hell all over the company’s management team.

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Source: TechCrunch: Here’s Twitter’s Slowing User Growth In One Chart:

• LinkedIn Q4 earnings revenue $643M, +44% Y/Y; net income $3.1M; strong hiring environment and success in China send shares up 7%: LinkedIn reported a higher-than-expected 44 percent jump in quarterly revenue as more businesses used its services to assess candidates for employment. The company's shares rose 8 percent after the bell. LinkedIn's hiring business has been thriving, clocking revenue growth of nearly 50 percent in each of the last three quarters, helped by rapid expansion in international markets such as China. "In the fourth-quarter, more than 75 percent of new members came to LinkedIn from outside the United States," Chief Executive Jeff Weiner said on a post-earnings call. The company added 3,000 new customers to its hiring business in the quarter, Chief Financial Officer Steve Sordello said. Revenue in LinkedIn's hiring business, called Talent Solutions, jumped 41 percent to $369.3 million in the fourth quarter ended Dec. 31, accounting for 57 percent of the company's revenue. The company's net income fell to $3.1 million, or 2 cents per share, in the fourth quarter, from $3.8 million, or 3 cents per share, a year earlier. Excluding items, the company earned 61 cents per share. Revenue rose to $643.4 million from $447.2 million. LinkedIn also forecast an adjusted profit of $2.95 per share for 2015, above the average analyst estimate of $2.73. LinkedIn's shares were trading at $255.55 after closing at $237.97 on Thursday.

• Indian startup action: Alipay comes to India: investment in One97 confirmed; will acquire 25% stake - financials not disclosed: (more coverage here) Ant Financial, the affiliate group of Alibaba that oversees its third-party payment service Alipay, has invested in India’s One97, the parent company of third-party payment service Paytm, Bloomberg reports. The size of the investment has not been disclosed, but Ant Financial will take a 25 percent stake in the New Delhi-based firm. Rumors of the investment had been circulating for weeks, with the Wall Street Journal and others reporting the round was worth US$575 million. Paytm is a payment processor built specifically for India’s mobile shoppers. The Reserve Bank of India places tough restrictions on companies looking to receive a PPI license (prepaid payment instrument) license, so Paytm’s permission, coupled with its two-tap checkout procedure, have helped it gain strong traction domestically. When Tech in Asia profiled the company in October 2014, founder Vijay Shekhar Sharma claimed that Paytm was processing 600,000 orders every day, and 5 million orders on mobile every month. Ant Financial Services Group, China’s leading online financial services company that owns AliPay, is all set to acquire 25 per cent stake in Noida-headquartered mobile internet firm One97 Communications Ltd. The financials of the deal are not disclosed. Ant Financial, an affiliate of China’s Alibaba Group Holding Ltd, will provide One97’s m-com and virtual wallet property Paytm with strategic and technical support for its business, following the deal. The companies will also build on synergies in the mobile wallet front. This deal also marks Ant Financial’s entry into the Indian market. Last month, Techcircle.in had reported that One97 is raising $575 million from the world’s largest e-com firm Alibaba and the group’s separate payment unit Alipay. This was in addition to $60 million more from existing lead investor SAIF Partners. One97 had zeroed in on Alibaba Group as the new investor after negotiating with various possible suitors including Singapore’s state-owned investment firm Temasek among others. It had signed a term-sheet for investment with Temasek as first reported by Techcircle.in but decided to go ahead with a deal with Alibaba. Founded in 2000, One97 Communications is a leading mobile-internet company in India that offers digital goods & services to its mobile consumers under the Paytm brand. It also provides mobile advertising, marketing and payments for merchants. In addition, it has a partnership with existing lead investor SAIF Partners where it invests in early stage mobile internet startups through One97 Mobility Fund.

• Indian startup action: India’s FreeCharge, Which Gives Users Coupons When They Pay Bills, Raises $80M Series C: FreeCharge, an India-based mobile commerce platform that gives users coupons and other rewards when they pay their phone, satellite television, and utility bills, has raised an $80 million series C. The round included new investors Valiant Capital Management and Tybourne Capital Management, as well as returning investors Sequoia Capital, RuNet, and Sofina. TechCrunch last covered FreeCharge in September, when it raised a $33 million Series B. Its latest funding brings FreeCharge’s total raised so far to about $115 million. The company says it now has a customer base of more than 20 million. Its mobile app was downloaded 10 million times last year. Customers use FreeCharge by logging onto its website or mobile apps to top up their prepaid mobile phone plans or pay TV and utility bills. FreeCharge then emails them coupons which can be redeemed at leading e-commerce sites like Flipkart and Amazon India or in brick-and-mortar retailers such as McDonalds, Baskin Robbins, and coffee shops. For participating vendors, FreeCharge offers insight into consumer behavior by tracking which coupons are redeemed and what products or services they are used for. In addition to providing coupons, FreeCharge eventually plans to expand into transaction advertising. It is eyeing growth in Southeast Asia, Latin America, and Africa

• Major hacker attack on US insurance giant Anthem - motives unclear, but fears of Chinese state-sponsored group involvement:: A hack at Anthem, the second-largest health insurer in the country, exposed personal information about millions of employees and customers. But the attack is just the latest evidence that cybercriminals are increasingly targeting the medical sector where they can collect health information that can be sold for a premium on the black market. "What we've seen in the last few years is that attackers have realized the economics of health-care data are very, very attractive," says Lee Weiner, senior vice president at cybersecurity firm Rapid7. Anthem said hackers collected several pieces of personal information about its employees and customers, including Social Security numbers, birthdays and street and e-mail addresses. But the hack also included medical information numbers, which can be among the most damaging types of stolen data and be used to commit medical fraud, according to security experts. Complete health insurance credentials sold for $20 a piece on underground markets in 2013, according to Dell SecureWorks. That is 10 to 20 times more than a U.S. credit card number with a security code. Fears of Chinese state-sponsored group involvement: Investigators of Anthem Inc.’s data breach are pursuing evidence that points to Chinese state-sponsored hackers who are stealing personal information from health-care companies for purposes other than pure profit, according to three people familiar with the probe. The breach, which exposed Social Security numbers and other sensitive details of 80 million customers, is one of the biggest thefts of medical-related customer data in U.S. history. The attack appears to follow a pattern of thefts of medical data by foreigners seeking a pathway into the personal lives and computers of a select group -- defense contractors, government workers and others, according to a U.S. government official familiar with a more than year-long investigation into the evidence of a broader campaign. The Federal Bureau of Investigation is leading the investigation, according to Anthem, which has hired FireEye Inc., a Milpitas, California-based security company, to assist. China has said in the past that it doesn’t conduct espionage through hacking. The Chinese embassy in Washington didn’t immediately respond to a request for comment. Hackers could use stolen information -- which Anthem said in its case included birthdates and e-mail addresses -- to conduct “phishing” attacks on customers who unwittingly provide access to their companies’ networks. Government officials have been investigating whether foreign interests are using personal, financial or medical information as leverage to gain intelligence from people who want their information to stay private, according to the U.S. official.

• Leaking can be risky: SEC investigates options trades on Blackberry-Samsung rumors: The U.S. Securities and Exchange Commission is investigating a January 14 spike in trading in BlackBerry Ltd options that took place hours before Reuters reported that Samsung Electronics Co was in talks to buy the Canadian smartphone maker, according to a person familiar with the investigation. One trade the SEC is looking at took place at 12:06 p.m. on that day, when there was a purchase of options with the rights to buy 200,000 shares of BlackBerry stock at a strike price of $10 a share, the person said. Later that afternoon, Reuters reported that Samsung had offered to buy BlackBerry for as much as $7.5 billion, valuing its stock at between $13.35 to $15.49 per share, a 38 percent to 60 percent premium over BlackBerry’s trading price at the time. BlackBerry’s stock, which closed on Jan. 13 at $9.71, shot up 30% on the news to close at $12.60 on Jan. 14, its biggest one-day gain in years. The call options, which expired on January 23, were purchased for 10 cents in the trade. They surged on the Reuters story to a high of $2.55. If the buyer had been able to sell the options at that high they would have been able to make a profit of $490,000 on a $20,000 investment. It is unclear, though, whether the buyer was able to sell the options at a profit. The SEC is investigating whether a source of information provided to Reuters bought Blackberry options, according to the person familiar with the investigation. Both companies later denied they were in talks and BlackBerry’s shares tumbled. Reuters subsequently corrected its story to make clear that the discussions were between advisors rather than company officials. There is no indication that Reuters is a target of the investigation. A spokeswoman for Thomson Reuters declined to comment.

• A sad day: RadioShack has officially filed for Chapter 11 bankruptcy. Once a home base to the radio/homebrew/DIY geeks of the world, RadioShack devolved into a glorified cell phone store in the early 2000s. While they’ve spent the last few years trying to find their roots with things like a dedicated section for Arduino gear*, they’ve mostly failed to get bodies back in the store.