10 Fun New Facts Found in Twitter's IPO Filing
Twitter's initial public offering is official as of Thursday, which means Wall Street investors and tech journalists are collectively losing their minds from all the excitement. The IPO doesn't mean much for Twitter's 215 million+ monthly active users, except that Twitter needs you to survive--and it's a little worried that you might move on.
Fri, October 04, 2013
IDG News Service —
The S-1 form Twitter filed with the Securities and Exchange Commission is a long slog filled with fascinating tidbits the social network has never before disclosed. You're obviously not going to read the whole thing, so we plucked the 10 most interesting facts from what is perhaps the first SEC filing to contain tweets.
Last December, Twitter was ecstatic: The social network now had 200 million monthly active users. But in six months, that number didn't move that much. As of June 30, Twitter had 218.3 million monthly active users. For comparison, Twitter's active users jumped from 151.4 million to 200 million from June to December 2012. In its IPO filing, Twitter said it expects user growth to slow, so it will have to boost engagement with ads to continue to make money. Twitter relies on a pay-for-performance business model, so if you don't click on those promoted tweets, Twitter gets nada.
Twitter might not have the broad user base that Facebook does--once you can count to a billion, it's all over--but it's also a more public forum than Facebook is. Twitter said its influence extends across the Internet with more than 30 billion impressions of tweets in the second quarter of the year. Even if Twitter doesn't grow its number of monthly actives, its reach is still impressive.
Not only is Twitter not growing that much, it's not a profitable company. (Are you ready to invest yet?) The company lost $69.3 million in the first six months of this year, and is running a total deficit of $418.6 million. Twitter's revenue increased from $28.3 million in 2010 to $316.9 million last year with the introduction of ad products, but in the IPO filing, the company said it expects its revenue growth to slow.
Fierce competition from stickers
Twitter has a huge international user base--77 percent of its active users in the second quarter of this year live overseas. But in its IPO filing, Twitter said social networks in Asia with similar messaging features pose a big threat to the network's international growth potential. The company pointed specifically to Japan's Line, South Korea's Kakao, and China's Sina Weibo as competition for Asian users. Twitter faces a huge international growth problem if it can't crack China, where Sina Weibo dominates and access to Twitter is blocked.