When Twitter co-founders Evan Williams and Biz Stone were the heads of the companies, they were interested in growing the micro-blogging social network rather than monetizing it. Once CEO Dick Costolo was brought in, he emphasized on the company’s revenue model. Twitter started to sell ads in April 2010 in the form of a test.
Twitter generated $7.3 million in ad revenue for 2010. In 2011, Twitter hit $77.7 million. Last year, Twitter hit $316.9 million in ad revenues. This year, Twitter is expected to double last year’s number. For the first half of this year, Twitter sold over $253.6 million in ad sales. About 65% of Twitter’s ad revenues came from Google Android and Apple iOS.
However, Twitter is not yet profitable. The company lost $79.4 million in 2012 and $69.3 million in the first half of 2013.
?From 2011 to 2012, revenue increased by 198% to $316.9 million, net loss decreased by 38% to $79.4 million and Adjusted EBITDA increased by 149% to $21.2 million. From the six months ended June 30, 2012 to the six months ended June 30, 2013, revenue increased by 107% to $253.6 million, net loss increased by 41% to $69.3 million and Adjusted EBITDA increased by $20.7 million to $21.4 million.?
Twitter has 215 million active users and 500 million tweets are sent out per day. As of December, they were hitting around 200 million tweets sent per day. As of the middle of this year, Twitter had $164.4 million in cash or cash equivalents.
Here is a list of the majority owners in Twitter:
– Dick Costolo – 7.6 million shares
– Jack Dorsey – 23.4 million shares
– Evan Williams – 56.9 million shares
– Peter Fenton/Benchmark Capital – 32.6 million shares
Other major holders in Twitter include Spark Capital, Benchmark Capital, Union Square Partners, DST Global, and Rizvi Traverse.
Shares are expected to start trading this November. Twitter is now going to go on a public road show for investors.
Twitter has created a new metric called advertising revenue per timeline view. The Timeline views are the total number of timelines requested when registered users visit Twitter, refresh a timeline, or view search results while logged into the website. Twitter said that their advertising revenue per timeline view was $2.17 in the U.S. and 30 cents for the rest of the world during Q2 of this year. The worldwide advertising revenue per timeline view is at 80 cents.