Twitter reports $645m loss for 2013

It's an interesting question. By comparison, at the end of 2010 Facebook had about 2,000 +/- employees and $2b in sales for that fiscal year. Twitter is roughly three times overstaffed compared to Facebook.

No profit model? Completely wrong.

According to the IPO docs they make about $2/1000 views in America (which is good) and were projected to make $1 billion in revenue this year (also good). This article reports that their first quarter revenue is about $250 million, more than double the previous year, which makes their prediction definitely feasible. The remaining question is whether they can turn this revenue into profit, and my answer is yes, because (1) the growth of their operating costs is dramatically outpaced by the growth of their revenue, and (2) most of their losses are due to acquisitions (and they are smart acquisitions). So overall this is a pretty strong portfolio and I'd say it's a completely reasonable bet they're going to be significantly profitable soon.

Now. Serious question: did you read this article? If yes you should be embarrassed at your misapprehension here, because in spite of the title, this data in this article actually paints a pretty damn rosy picture of Twitter's future. If no, then why are you commenting here? Here I am sounding cranky, but if you're going to do the ALL INTERNET SHOUTING CAPS thing then you'd better take care not to say something silly. Just my personal opinion, but next time I'd start by both reading the article and understanding the article, and I'd follow that up with taking care to make it sound like I don't think that everyone who disagrees with me is, blanket statement, stupid. Because some of us have done our homework and still disagree with you.

Before we jump the gun on this "loss", read this first:[1]

  Net loss - GAAP net loss was $511 million for the fourth quarter of 2013 compared to a net loss of $9 million in the same period last year. The company's Q4 GAAP net loss included $521 million of stock-based compensation expense, of which $406 million was for restricted stock units previously granted to employees, for which no expense had been recognized, until the effective date of our initial public offering in accordance with GAAP.

  Adjusted EBITDA - Adjusted EBITDA was $45 million for the fourth quarter of 2013 compared to $18 million in the same period last year.

  Non-GAAP net income / loss - Non-GAAP net income was $10 million for the fourth quarter of 2013 compared to a Non-GAAP net loss of $0.3 million in the same period last year.

Oddly enough the "The company's Q4 GAAP net loss included $521 million of stock-based compensation expense, of which $406 million was for restricted stock units previously granted to employees, for which no expense had been recognized, until the effective date of our initial public offering in accordance with GAAP." seems be tucked away in "Research and Development" part of the P&L.

It's worth noting they have $2.2b in cash:

> Cash, cash equivalents and marketable securities - As of December 31, 2013, cash, cash equivalents and marketable securities were approximately $2.2 billion, compared to $321 million as of September 30, 2013.

TL;DR - This $645m "loss" isn't what you think it is.

[1]https://investor.twitterinc.com/releasedetail.cfm?ReleaseID=...

The stock fell 18% because "monthly active users" grew "less than 4 per cent...between the third and fourth quarters," with US user growth at just "3 per cent quarter-on-quarter". "Facebook," by comparison, "increased its user numbers at the same 4 per cent rate from a much larger base in the same period" [1]. The GAAP loss highlighted is due to one-off accounting charges related to stock compensation.

Note that revenues came in 4% above expectations and 110% higher than last year's.

[1] http://www.ft.com/cms/s/0/a1ecfc6e-8eab-11e3-b6f1-00144feab7...

Do you happen to know how the active user base compares between 2010 Facebook and 2013 Twitter?