Twitter IPO Valuation $12.8 Billion, Company Remains Unprofitable and in Debt

by Knowlton Thomas | Culture

As the details of Twitters' initial public offering unravel, company documents suggest a valuation of $12.8 billion.

The company, which remains unprofitable after seven years, generated $253 million during the first half of this year.

“Whether it’s worth $12 billion or not is really going to come down to how they can embrace this real-time news and information vision, how they can extend it to other revenue lines and how they can grow around the world,” Brian Blau, a San Francisco-based technology analyst at Gartner, said in an interview with Bloomberg.

Twitter's valuation puts it at nearly 29 times annual revenue—a higher figure even than Facebook's, whose IPO was a flop (the company finally reached its original IPO share price after a year in the red). LinkedIn, arguably tech's most successful recent IPO, was valued at 14.5 times revenue.

65% of Twitter's ad revenue is generated from mobile, higher than Facebook's 41%. But the microblogging network posted a net loss of almost $70 million in the first half of this year—a greater loss than the same period last year. Its total defecit is now in excess of $400 million.

Twitter's IPO includes 32 pages of risk factors, 10 more than Facebook's IPO filing last year.

The social network claims 218 million active monthly users, up 44% from last year. The company earns 64 cents of revenue per user.

San Francisco, California, United States

Twitter is a privately funded startup with offices in the SoMA neighborhood of San Francisco, CA. Started as a side project in March of 2006, Twitter has grown into a real-time short messaging service that works over multiple networks and devices. In countries all around the world, people follow the sources most relevant to them and access information via Twitter as it happens—from breaking... more

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Knowlton Thomas

Knowlton Thomas

Knowlton is the managing editor of Techvibes and author of Tempest Bound. Based in Vancouver, Knowlton has been published in national publications and has also appeared on television and radio. Previously he was an editor for New Westminster weekly The Other Press and served on its board of directors. When not working, Knowlton enjoys hiking, tennis, and martial arts. more

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