Facebook Files for $5 Billion IPO

Facebook has finally filed for a long awaited $5 billion initial public offering (IPO) of stock in the US with the SEC. According to Facebook, it will trade with the stock symbol of ‘FB’.

It was predicted earlier that the social networking giant will file initial paperwork for its IPO, looking to raise $5 billion in its public offering bid. The lead bookrunner role is taken by Morgan Stanley, while Goldman Sachs, Bank of America, Merill Lynch, Barclays Capital and JP Morgan ended up with six another initial bookrunners.

Facebook’s public offering has been on slate for mid-May due to its new Timeline feature. The company has now entered into a mandated quiet period. It means that the company won’t launch any new product or feature during this period. It is therefore Timeline is the last new product introduced by Facebook.

If we look at the major figures claimed in the filing by Facebook, it has over 845 million active monthly users. In revenue, the company managed to generate $3.71 billion with $1 billion in profit last year – doubled from what it had in 2010. Currently, Facebook has $3.9 billion in cash on hand.

Mark Zuckerberg, Founder and CEO of the social network, owns 28.4% of the company, earning $483,000 as salary. He also got a bonus of $220,000 last year. Interestingly, the social network also praises Zynga for providing 12% of revenue in 2011.

The social network is hoping to focus on mobile and it has some solid reason for this:

“We had more than 425 million MAUs who used Facebook mobile products in December 2011. We anticipate that the rate of growth in mobile users will continue to exceed the growth rate of our overall MAUs for the foreseeable future, in part due to our focus on developing mobile products to encourage mobile usage of Facebook.”

Facebook also explains that the company depends heavily on the interoperability of mobile operating systems with its app:

“We are dependent on the interoperability of Facebook with popular mobile operating systems that we do not control, such as Android and iOS, and any changes in such systems that degrade our products’ functionality or give preferential treatment to competitive products could adversely affect Facebook usage on mobile devices.”

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