Twitter Inc., announced its IPO details on October 4th racing toward the largest Silicon Valley IPO since Facebook Inc.’s 2012 coming out party. However Twitter reveals big losses over the past three years behind behind rip-roaring revenue growth.
In the first public disclosure of of financial figures, Twitter reported that revenue almost trippled to $316.9 million US in 2012. In the first half of 2013, it posted revenue of $253.6 million but had a loss of $69.3 million. Also, according to Reuters’ calculation, Twitter only managed average revenue per user in the second quarter of 2013 of 64 cents compared to Facebook’s roughly $1.60.
However, the analysts at Pivotal Research Group said the losses are “non-issue”, but the point is how long the revenue Twitter gains from advertisers will last. The big losses ahead of Twitter’s IPO has triggered the attention from all fields, and one thing that warned Twitter should be attentive is that it was heavily reliant on advertising revenue. More than 87 percent of its revenue came from advertising in the half of 2013 according to the report. Consequently, that causes investors to keep cautious about Twitter’s IPO prospect. At the same time, following Twitter’s IPO progress, these issues will eventually become unavoidable major problems for their future development.
Article:
http://www.bnn.ca/News/2013/10/4/Twitter-reveals-rip-roaring-growth-big-losses-ahead-of-IPO.aspx