What will Facebook's registration filing reveal?

While registered users on the social network are visibly expanding, information about Facebook's revenue and operating margins is erratic at best.

By Trefis Nov 28, 2011 12:31PM
Image: African-American woman shopping online (© Ariel Skelley/Blend Images/Getty Images)Speculation is rising that Facebook might file for an IPO before 2012 itself.

While valuations for the company have gone to as high as $100 billion in private markets, an initial registration statement is all it takes to provide a much clearer picture of how Facebook's metrics are faring. Facebook leads the global social networking arena, competing with the likes of Google (GOOG), LinkedIn and MySpace.

See our complete analysis for Facebook


Trefis Break-up of Facebook
Registration would throw light on metrics


Much like Groupon (GRPN) and LinkedIn (LNKD), Facebook's purported valuations have varied considerably since the last one year. A big reason for this is an asymmetry of information regarding Facebook's operating metrics.


While registered users on Facebook are visibly expanding, information on Facebook's revenue and operating margins is erratic at best as the company has no obligation to release its financial data. As a result, a single figure released from a relatively anonymous source can send the market into a flurry.


While Groupon obviously has its share of problems, these issues came into light as the company released its first S-1 registration in June 2011. For now, Facebook seems clear of any worrying statistics, with its user base ever expanding to over 800 million now and revenues doubling to $1.6 billion in 1H-2011. With the success of tech IPOs in the past few months, the company is surely considering this a ripe time to go public. Facebook's ubiquity and enormous influence on the internet is sure to make this a highly anticipated event.


We currently value Facebook at around $45 billion.


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