Automattic Acquires Tumblr for Fraction of Original Billion-Dollar Price
WordPress parent company Automattic purchases the struggling blogging platform Tumblr from Verizon for a reported sum well below $20 million. The deal brings 200 staffers over to Automattic as Tumblr seeks to rebuild its once-dominant community.
Verizon sells the once-dominant blogging platform Tumblr to Automattic, the parent company of WordPress, for a nominal sum that reports indicate falls well below $20 million. This massive financial drop starkly contrasts with Yahoo's 2013 acquisition of the site for over $1 billion, highlighting a dramatic decline in the platform's market value over the past six years.
The platform struggles to maintain its relevance as competitors like Facebook, Instagram, and Reddit capture the majority of user attention. A controversial decision to ban adult content further accelerates this downward trend, causing a 33% year-over-year decline in new mobile app users during the last quarter.
Automattic CEO Matt Mullenweg embraces Tumblr as an iconic web brand that aligns perfectly with his company's mission to democratize online publishing. As part of the transition, Automattic absorbs 200 Tumblr employees and plans to integrate the platform alongside its existing suite of tools that includes WordPress.com, WooCommerce, and Jetpack.