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.