Steve Ballmer may have left the CEO job at Microsoft Corp. (NASDAQ: MSFT) under a cloud, but he is still one of the most famous people in the history of tech, and a wildly rich man. Ballmer said in a tweet that he had bought 4% of Twitter Inc. (NYSE: TWTR), an investment of $1 billion. The share value jumped 5%. This is not the end of the Ballmer rally, particularly if his uncanny knowledge of the Internet world is right.

Ballmer’s bet is probably on new CEO Jack Dorsey. Like Ballmer and his “partner,” Microsoft founder Bill Gates, Dorsey began his successful career at an early age, Dorsey has been a founder of both Twitter and mobile payment system Square.

Ballmer also has been through the challenge of making businesses that appear to have little future revenue into ones that do. Prime among these is Xbox, which he championed year after year, and which finally became the leading game console in the world.

Twitter will release its third-quarter earnings results soon. It will be the first sign of whether Ballmer’s instincts are right, although the numbers could be too early an indication. In the second quarter, revenue rose to $502 million from $312 million in the same quarter a year ago. However, Twitter lost $136 million. Twitter did end the quarter with a massive 316 million average monthly active users. While the figure is large, Twitter has not found a way to make money on the base.

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Twitter was not sanguine about the near-term future:

Twitter’s outlook for the third quarter of 2015 is as follows:

• Revenue is projected to be in the range of $545 million to $560 million.
• Adjusted EBITDA is projected to be in the range of $110 million to $115 million.
• Stock-based compensation expense is projected to be in the range of $190 million to $200 million, excluding the impact of equity awards that may be granted in connection with potential future
  acquisitions.

Since the end of the second quarter, Twitter has cemented it presence in professional sports content, which has always been among its strengths. As the election season starts, Twitter is a major platform to exchange news about candidates and their actions instantly. The NFL season and election cycle may, by themselves, prove that Twitter is a strong medium for advertising, particularly as its members chronicle current events.

Twitter management also has begun a pruning, which is supposed to “focus” its future plans. This includes laying off about 8% of its staff.

As a final evaluation, Ballmer also may think Twitter can get back to its 52-week high with even modest success. He saw that happened when optimists about Microsoft overcame the presence and force of pessimists. Twitter trades near $31, against a 52-week high of just over $53, which is 71% above the current price.

Ballmer has put enough money on the line to argue that he has not only looked at Twitter carefully, but thinks he can make several hundred thousands of dollars, or more.

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