Twitter makes IPO filing public, looks to raise $1B

Steven Loeb · October 4, 2013 · Short URL:

Company has 215 million monthly active users, and revenue of $253.6 million

As promised, Twitter made its IPO filing public this week. So now we all know what was trying to keep quiet for so long, including its user numbers, how much it is going to trying to raise and who its underwriters are.

Here's a breakdown of what we now know:

  • IPO price

First off, the big number: the company is looking to raise $1 billion by selling 472,613,753 shares of common stock.

The shares will be trading under the symbol "TWTR."

Goldman Sachs is the lead underwriter, along with Morgan Stanley, JPMorgan, BofA Merrill, and Deutsche Bank.

  • User numbers

In the three months ending June 30th, Twitter averaged 218.3 million monthly active users (MAUs). That was a 44% increase from the 151.4 million average MAUs it was seeing in the same period a year before.

And a lot of that growth is on mobile. In that same period, 75% of those MAUs came from a mobile device, and over 65% of Twitter's ad revenue came from mobile as well.

"We expect that the proportion of active users on, and advertising revenue generated from, mobile devices, will continue to grow in the near term," the company wrote.

When broken down by country, 49.2 million of Twitter's MAUs came from the United States, and 169.1 million came from international users. Those numbers jumped significantly as well: 35% and 47%, respectively, from the year before. 

Twitter also revealed numbers for timeline views:  150.9 billion in the last three months, and 287.2 billion timeline views in the last six months. That is an increase of 69% and 79% from the same time last year.

Users are creating 500 million tweets every day, and over 100 million are daily active users. 

  • Revenue and spending

The good news for Twitter: it saw rapid revenue growth from 2011 to 2012, jumping 198% to $316.9 million. And it's net loss decreased by 38% to $79.4 million.

The bad news: the company is still operating at a loss. While revenue in the first six months of 2013 also rose, going up 107% to $253.6 million, so did the company's net loss. That rose 41% to $69.3 million.

As expected, the vast majority of Twitter's revenue is coming from advertising; it accounted for $221.4 million. The other $32.2 million is from data and licensing. 

The  vast majority of Twitter's spending is on research and development, with $111.8 million. $91.8 million goes to cost of revenue, which is the money the company spends to run its data centers and servers, another $77.7 goes to sales and marketing, and the last $35 million is spent on "general and administrative" costs.

Filing confidentially

When Twitter announced that it had filed for an IPO, the company also revealed that it had done so confidentially, taking advantage of a new rule in last year's JOBS Act. That meant that there was no way to know any of its plans, its underwriters, its timeline or its pricing. In fact, nobody knows anything at all, which was basically the point.

The rule that Twitter took advantage of loosened regulations for "emerging growth companies," which only applies to companies with less than $1 billion in revenue.

According to that bill, companies are allowed to file for an IPO confidentially, meaning that they do not have to disclose anything about the company until 21 days before the start of its road show, where it will have to market itself to investors, if the company ever even decides to have one.

It has been widely speculated that Twitter wants to be trading on the New York Stock Exchange by Thanksgiving, and so finally making its information public is an important step in getting it ready in time.

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