Twitter Selects NYSE For IPO, Triples Quarterly Losses
Twitter has revealed on Tuesday that their quarterly losses have tripled. Twitter also revealed that they will be listing on the New York Stock Exchange (NYSE). Other tech stocks that are on the NYSE include Pandora, LinkedIn, Yelp, Demand Media, Bankrate, and Fusion-IO.
It is not surprising to see Twitter go with the New York Stock Exchange. Twitter’s largest rival, Facebook, trades on the Nasdaq and their IPO was plagued with errors in 2012. The Nasdaq also had another major outage recently.
Twitter is going to be starting their investor roadshow on October 28th and will be pitching the offering to Wall Street investors before their shares start to trade in mid-November, according to sources with Reuters.
Twitter’s revenues more than doubled in Q3 at $168.6 million, but their net losses widened to $64.6 million. This is compared to $21.6 million a year earlier. Twitter’s monthly active users grew 39% to 231.7 million on average, which is up from 218 million when they first disclosed their IPO on October 3rd.
What caused the losses? The company’s sales and marketing spending increased 158% so that they could ramp up their sales team around the world to sell their advertising platform. Twitter’s sales and marketing costs increased to $61.2 million from $23.7 million one year earlier. Twitter’s revenue is mostly coming from mobile devices. For the three months ending through September, over 70% of their advertising revenue came from smartphones and tablets compared to 65% in the previous quarter.
It is rumored that Nasdaq CEO Robert Greifeld flew to Twitter’s headquarters in San Francisco to make a pitch for listening on his exchange. “This is a decisive win for the NYSE. We are grateful for Twitter’s confidence in our platform and look forward to partnering with them,” stated NYSE head of business listings Scott Cutler. The Nasdaq said that they wish Twitter well.
[Source: Reuters]This article was written by Amit Chowdhry. You can follow me at @amitchowdhry or on Google+ at +AmitChowdhry