MoPub, the mobile advertising business that Twitter acquired for $US350 million in stock right before it filed for an IPO, had only $US6.5 million in net revenue in the first half of 2013, according to a
new disclosure by Twitter to the SEC.
Previously, the only gauge of MoPub’s size in the marketplace was an estimated revenue “run-rate” of $US100 million. That number presumably included MoPub’s clients’ spending on mobile ads, which is passed through the company. The “net revenue” number is the sales fees and commissions that MoPub keeps for serving its clients.
So people expected MoPub’s net revenue to be smaller than $US100 million.
But just $US6.5 million over 6 months? From a company that employs about 100 people? That’s a shock to those observing the deal. Twitter didn’t disclose MoPub’s gross revenues, or what the total amount of client spending is behind MoPub’s business.
For comparison, Millennial Media, one of MoPub’s competitors, had net revenues (“gross profit,” as disclosed) of $US45 million over the same half-year period on gross revenues of $US106 million.
That $US6.5 million is up from just $US2.7 million in revenue the year before:
- H1 2012: $US2.7 million
- H1 2013: $US6.5 million
The disclosure also indicates that MoPub wasn’t profitable in either 2012 or 2013. That’s not too surprising because it is an early-stage company that is still reliant on its investors’ funding. It’s still growing, and capturing market share, in other words. It has taken $US18.5 million in total from venture capitalists since 2010.
But the disappointment, perhaps, for those who thought that MoPub might add a significant new mobile ad revenue base for Twitter is that MoPub’s revenues are just 1.5% of Twitter’s $US422 million in sales over the same period.
MoPub, in other words, has a long way to go before it contributes meaningfully to Twitter’s ad business.