Twitter's IPO was surprise to observers
After Facebook's botched debut, analysts had not expected this move until 2014.
While the San Francisco micro-blogging site had been widely believed to be on the path to an initial public offering, most pundits had not expected it to happen until 2014. Sitting on hundreds of millions of dollars in venture capital, Twitter's leaders repeatedly insisted they were not focused on going public.
But with Wall Street fully recovered from an IPO lull that followed last year's botched Facebook debut, Silicon Valley's most anticipated stock offering since - well, since Facebook's - is officially in the pipeline.
"Why go public now? I'd say because it can," said Bill Tai, a venture capitalist with Charles River Ventures. His firm was among the first investors in Twitter.
Answers about the timing - or anything else - were not forthcoming from Twitter. Not only is the company now under "quiet period" rules imposed by the Securities and Exchange Commission, it chose to file under new SEC rules that permit many details to remain secret for now.
The company used its own Twitter account Thursday afternoon to announce it had filed the confidential IPO plan. A spokesman declined to comment on such details as how much money the company hopes to raise from investors or when the stock offering might take place.
But the fact that Twitter is using a confidential filing hints at one detail about its finances: The new SEC rules that permit such filings limit them to companies with less than $1 billion in annual revenue.
That's why Karsten Weide, who tracks online media for the IDC research firm, was among those surprised by the announcement. "Their ad business is growing quickly, but it's still very small," he said.
Speculation about a Twitter IPO died down after Facebook's rough Wall Street debut, which saw its shares sink from an initial price of $38 to less than $20 over its first year of trading. Facebook has rebounded of late, pushing to an all-time high of more than $45 Wednesday after the company's most recent earnings report showed strong revenue gains.