News Column

Twitter Chirps About IPO Prospects

March 28, 2013
Twitter

Twitter's prospects as an IPO candidate just got brighter.

The microblogging company is expected to haul in $950 million in ad revenue in 2014, according to eMarketer, as the company gains traction in mobile advertising. That's up from the firm's September forecast of $808 million in the period.

The researcher predicts ad revenue of $1.3 billion by 2015.

Twitter is widely expected to file regulatory documents as soon as this year to go public in one of the most highly anticipated IPOs. Reports have circulated for months that the popular social-messaging service is valued at roughly $10 billion.

Twitter's mobile ad uptick "does bode well for an IPO," says Opus Research analyst Greg Sterling. "There's been a gradual and accelerating trend toward mobile" ads in general.

A Twitter IPO would be a crowning moment for creator Jack Dorsey, whose start-up Square is also a contender to soon file to go public.

Mobile ad revenue is rocketing for Twitter. For the current year, Twitter is expected to scoop up total ad revenue of $583 million, compared with a previous estimate of $545 million. For the year, eMarketer forecasts Twitter will earn $309 million from mobile ad revenue, compared with $138 million in 2012, as consumers flock to mobile devices.

"The recent run in Twitter's mobile ad revenue represents a shift in media spend towards mobile," says Paul Gelb, chief of strategy and marketing at mobile ad exchange MoPub. There's "a much larger shift than anticipated to mobile."

Twitter's mobile ad revenue was zilch in 2011. This year, mobile is expected to make up to 53% of Twitter's total ad revenue and by 2015, more than 60%, according to eMarketer.

Twitter spokesman Jim Prosser declined to comment.

Worldwide mobile advertising revenue is predicted to reach $11.3 billion in 2013, according to researcher Gartner, compared with $9.6 billion in 2012. The research firm expects worldwide mobile advertising to hit $24.5 billion by 2016, driven by growth in tablets and smartphones.

Facebook is tapping into the mobile boom, as well. Mobile advertising on Facebook swelled to 23% of its ad revenue in the fourth quarter, up from 14% in the previous quarter, boosting the social network's earnings past expectations.



Source: Copyright USA TODAY 2013


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