Twitter is a real-time online social networking platform that allows users to post messages of up to 140 characters as well as photographs and links to other websites. These are known as tweets. It was founded in 2006 by Jack Dorsey. As of 2012 it reported over 500 million active users generating over 340 million tweets daily, making it one of the world's most visited websites.
Twitter losses widen ahead of New York IPO
As microblogger prepares to list its shares next month, quarterly net losses triple to US$64.6m
Reuters in San Francisco
Twitter revealed on Tuesday a tripling in quarterly losses as it prepares to list on the New York Stock Exchange in one of the year's most anticipated IPOs.
The online messaging service's decision to go with the older exchange deals a blow to the tech-heavy Nasdaq, which bungled Facebook's 2012 initial public offering. Twitter is now expected to kick off its investor roadshow on October 28 where it will pitch its offering to Wall Street before shares start trade in mid-November, said two sources familiar with the situation.
In an amended IPO filing on Tuesday, the eight-year-old firm showed it sustained its recent pace of revenue and user expansion in the latest quarter ended September 30 - even though its losses continued to widen.
Among the biggest winners of a successful IPO would be co-founder Evan Williams with a 12 per cent stake. Rizvi Traverse, run by Hollywood and Silicon Valley financier Suhail Rizvi, and its affiliates hold 17.6 per cent, as the largest institutional holder. JPMorgan Chase's alternative asset management arm holds another 10.3 per cent, the filing revealed for the first time. CEO Dick Costolo, an early angel investor, owns 1.6 per cent.
Rizvi and his investors, who obtained their shares with the help of Silicon Valley investor Chris Sacca, paid more than US$1 billion for their stake.
Other major stakeholders include Spark Capital and Benchmark Capital, which own 6.8 per cent and 6.6 per cent of the company, respectively. Union Square Ventures owns 5.9 per cent.
Twitter's debut will be the culmination of a journey from side-project to sociocultural phenomenon, one that has become a communications channel for everyone from the Pope to President Barack Obama.
The company more than doubled its third-quarter revenue to US$168.6 million. But net losses widened to US$64.6 million in the September quarter compared with US$21.6 million a year earlier.
And in the three months ended September, Twitter grew its monthly active users 39 per cent to 231.7 million on average. That figure was up from about 218 million when the company first disclosed its IPO filing on October 3.
Those losses were driven partly by a 158 per cent surge in sales and marketing spending, as the company ramped up its sales forces in offices around the world to push its advertising platform.