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Twitter announces plans for IPO

The logo of the social networking website Twitter

The logo of the social networking website Twitter is displayed on a computer screen in London. (Sept. 11, 2013) Photo Credit: Getty Images

Twitter is going public. The short-messaging service aptly tweeted Thursday it has filed confidential documents for an initial public offering of stock.

The documents are sealed, as Twitter is taking advantage of federal legislation passed last year that allows companies with less than $1 billion in revenue in their last fiscal year to avoid submitting public IPO documents.

San Francisco-based Twitter Inc. posted on its official Twitter account yesterday that it has "confidentially submitted an S-1 to the SEC for a planned IPO." The confidentiality will likely help Twitter avoid the public hoopla that surrounded the initial public offerings of other high-profile social networking companies, including Facebook Inc., which went public in May 2012.

Twitter's IPO would be the most highly anticipated offering since Facebook.Jim Prosser, a Twitter spokesman, declined to comment beyond the post.

Twitter was valued last month at about $10.5 billion by GSV Capital, one of its investors, up 5 percent from a May estimate. Facebook, which raised $16 billion last year, has a market value of about $109 billion.

Twitter has been ramping up its advertising products and working to boost ad revenue in preparation for an IPO.

Most of Twitter's revenue comes from advertising. Research firm eMarketer estimates that Twitter will make $582.8 million in worldwide ad revenue this year, up from $288.3 million in 2012. By 2015, Twitter's annual ad revenue is expected to hit $1.33 billion.

Combined News Services

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