That revenue number is an increase of 124% over the $139 million revenues from Twitter’s second quarter last year.
So yes, Twitter still posted a $145 million loss, but if we extrapolate (never good business practice, but an interesting thought experiment) and they do the same next year, they will be profitable by 2015.
It's unlikely that will happen, but there's light at the end of the tunnel.
There are a lot of one-time expenses involved with going public, so you'd have to strip those out of any extrapolation. But I'm not going anywhere near TWTR.
Twitter is an example of a business that has not, at least not as of yet, even come close to showing a justification for their valuation...or really, even being a publicly traded company.
I'm not saying it won't be, but there are companies that have gone public in the past two years with Billions (with a 'B') in revenue and solid profit margins where the stock is half of Twitter's share price, and those are much larger companies, similar share dilution, etc.
I know it's play money on a digital board, but some fundamentals cannot be ignored.
To be a business, you need to have higher income than expenses. So far, that has eluded Twitter -- and there's no indication that they are going to start spending less than they're making in the near future.
Also, I can see them making money from advertising. And after that... what?
I'm willing to believe and admit that Twitter is a game changer in many ways. But I'm far more skeptical of their ability to make money and survive. Clearly, Twitter's investors are bullish on Twitter's ability to make money. But if their optimism doesn't pan out soon, everyone with Twitter stock is going to be quite upset.
So yes, Twitter still posted a $145 million loss, but if we extrapolate (never good business practice, but an interesting thought experiment) and they do the same next year, they will be profitable by 2015.
It's unlikely that will happen, but there's light at the end of the tunnel.