Two people “with knowledge of the matter,” who are apparently irked at some analysts’ low forecasts, told Bloomberg that ad revenue would be “at least” $1 billion before the company’s ninth birthday. By comparison, eight-year-old Facebook generated more than $3 billion in ad revenue in 2011.
A Twitter spokesperson declined to comment.
Estimates published by eMarketer earlier this year suggest that the Twitter will only generate $540 million in ad revenue in 2014 — about double what eMarketer forecasts the San Francisco-based startup will bring in this year. Growth will be driven in part by Twitter’s self-service advertising platform for small businesses, which launched in November, and by international expansion, eMarketer said. Currently, 90% of ad revenue come from U.S. companies.
Unlike many other web-based publishers, Twitter doesn’t depend on display advertising for the bulk of its ad revenue. Instead, it has launched a suite of “Promoted” products that allow companies to increase the visibility of specific accounts, tweets and trending topics. Adam Bain, president of global revenue for Twitter, says Promoted Trends and Promoted Tweets yield engagement rates between 3% and 10% on average — many multiples higher than the average banner ad.
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