Twitter has bought native ads startup Namo Media to boost its advertising business as it escalates competition with Facebook and Google for mobile ad dollars.
Wall Street liked the deal. Shares of Twitter rose 99 cents or 3% to close at $33.89.
Native ads are becoming popular with advertisers trying to reach consumers on their mobile devices. The ads blend into content on mobile apps and mobile Web pages, rather than showing up in banners or pop-ups.
"We have been working to bring native ads to mobile app publishers in order to create a more seamless and less intrusive ad experience for users," Twitter's vice president of product Kevin Weil said in a blog post.
The terms of the deal were not disclosed. TechCrunch pegged the purchase price at $50 million.
Mobile advertising is on a tear. It's expected to outpace ad growth on personal computers in coming years as people spend more time on the Web via tablets and smartphones than from PCs and laptops.
In the U.S., mobile ad spending is expected to increase 82.5% to $17.7 billion this year, according to research firm eMarketer. Twitter is expected to grab 3.2% of that spending. Google is expected to dominate mobile ads with 35.7%. Facebook is expected to get 17.7%, eMarketer says.
Twitter bought MoPub for about $350 million in October. The mobile advertising exchange is now a critical part of Twitter's advertising business.Namo Media, founded in 2013 by three former Google employees, has worked on making it possible for advertisers to bid on native ads on exchanges such as MoPub. Namo Media said in a blog post that its technology would be folded into MoPub.
Namo Media had raised about $2 million in funding from Google Ventures, Andreessen Horowitz and other investors.
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