Twitter shares take flight after key hire, acquisition

The Twitter banner hangs at the NYSE.
Adam Jeffery | CNBC

Shares of Twitter closed up nearly 12 percent Tuesday after the company said it was buying Gnip—a start-up that it has worked closely with—and announced a key hire from Google.

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(L-R) Jack Dorsey and Evan Williams
Twitter CEO, co-founders not selling stock

Buying Gnip shows that Twitter wants to invest more heavily in enterprise services, such as advertising, said Brian Blau, an analyst at Gartner.

Gnip is one of the few companies that has access to Twitter's "Firehose," meaning all the data generated by millions of tweets, every day, in real time. The company then mines the data for trends or information that might be useful to other companies.

The buyout means the two companies will have a much closer relationship and signals where the company sees its strategy, going forward, Blau said.

Twitter also said it had hired Daniel Graf from Google, where he most recently ran Google Maps. Graf will be vice president of consumer products.

Graf's experience with consumer products is a good fit for Twitter, said Blau, where Twitter has shown some problems in getting users to stick with the service.

By CNBC's Matt Hunter