Facebook IPO: The things you can learn!

SELECTED CONSOLIDATED FINANCIAL DATA

 

The consolidated statements of income data for each of the years ended December 31, 2009, 2010, and 2011 and the consolidated balance sheets data as of December 31, 2010 and 2011 are derived from our audited consolidated financial statements that are included elsewhere in this prospectus. The consolidated statements of operations data for the years ended December 31, 2007 and 2008 and the consolidated balance sheets data as of December 31, 2007, 2008, and 2009 are derived from audited consolidated financial statements that are not included in this prospectus.

 

You should read this information together with “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our consolidated financial statements and the related notes included elsewhere in this prospectus.

 

		Year Ended December 31,
		2007				2008				2009				2010				2011
		(in millions, except per share data)
Consolidated Statements of Operations Data:
Revenue		$	153			$	272			$	777			$	1,974			$	3,711
Costs and expenses(1) :
Cost of revenue			41				124				223				493				860
Marketing and sales			32				76				115				184				427
Research and development			81				47				87				144				388
General and administrative			123				80				90				121				280
Total costs and expenses			277				327				515				942				1,955
Income (loss) from operations			(124	)			(55	)			262				1,032				1,756
Other expense, net			11				1				8				24				61
Income (loss) before provision for income taxes			(135	)			(56	)			254				1,008				1695
Provision for income taxes			3				—				25				402				695
Net income (loss)		$	(138	)		$	(56	)		$	229			$	606			$	1,000
Net income (loss) attributable to Class A and Class B common stockholders		$	(138	)		$	(56	)		$	122			$	372			$	668
Earnings (loss) per share attributable to Class A and Class B common stockholders(2):
Basic		$	(0.16	)		$	(0.06	)		$	0.12			$	0.34			$	0.52
Diluted		$	(0.16	)		$	(0.06	)		$	0.10			$	0.28			$	0.46
Pro forma earnings per share attributable to Class A and Class B common stockholders(2):
Basic																		$	0.49
Diluted																		$	0.43

 

(1)

Costs and expenses include share-based compensation expense as follows:

 

 

(2)

See note 2 of the notes to our consolidated financial statements for a description of how we compute basic and diluted earnings (loss) per share attributable to Class A and Class B common stockholders and pro forma basic and diluted earnings per share attributable to Class A and Class B common stockholders.

As you can see, Facebook was losing TONS of money until in 2007 and 2008, and it wasn’t until 2009 that revenue overtook expenses. Think about that, a company started in 2004, losing millions of dollars a year, and not until 2009 was it profitable. 5 years of just spending money, 5 years of justifying the lack of revenue and the costs of everything. 5 years of, “Yeah, we’ve been losing a lot of money, but you should still invest in us”.

Another interesting thing to look at is the MAU graph, it details out what Facebook has been doing since 2004, and how many users they have obtained through that time:

 

I just find it AMAZING how much information is being provided as a by-product of Facebook going public.

The link to Facebook’s Registration Statement can be found here: http://www.sec.gov/Archives/edgar/data/1326801/000119312512034517/d287954ds1.htm#toc287954_2