When Twitter went public back in 2013, it was an unprofitable company. More than two years later, that hasn’t changed. In fact, the company revealed in its annual 10-K filed Feb. 29 that it has lost more than $2 billion in total since launching a decade ago.
Twitter had already accrued more than $400 million in losses before going public, but that figure exploded upward after its IPO, largely due to stock-based compensation awarded to employees. The company lost $520 million in 2015 alone.
Like many companies, though, Twitter prefers to talk about adjusted earnings, which exclude stock-based compensation and some other expenses. These are the figures Wall Street investors tend to focus on. By that measure, Twitter had a net income of $277 million in 2015.
But anxiety over Twitter today has less to do with whether or not the company can earn money now and more to do with its prospects in the future. Wall Street appears skeptical that Twitter can effectively grow its user base, serve those users more ads and substantially increase its revenue. The company’s stock sunk below $20 per share at the start of the year, off from a high around $70, and has yet to recover.
Twitter is well aware of its own troubles. Elsewhere in the 10-K the company vows to emphasize live-streaming video, crack down on abusive accounts and “demonstrate our value proposition to a larger audience” through product improvements this year.