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Facebook Outlines Facebook Credits Business for IPO

Facebook logo 140pxFacebook filed its Form S-1 to IPO today. Here's what they said about their payments business:

  • Reported payments-related revenue was $13M (2009), $106M (2010), and $557M (2011). Full year 2011 payments revenue represented 15% of 2011 Facebook revenue.

  • They caution that year-to-year comparisons can be very misleading as the payments business didn't hit full deployment until Q42010, and wasn't mandated for on-platform game developers until Q3 2011. To help see the trends, they show quarter-to-quarter payments revenue growing throughout 2011 from $94M (Q1), to $119M (Q2), $156M (Q3), $188M (Q4). At $188M, payments represented 17% of the Q4 revenue.

  • Facebook also revealed that it has applied for "certain money transmitter licenses and expects to apply for additional money transmitter licenses in the United States."

Interestingly, Facebook doesn't use the term "Facebook Credits" in the S-1, preferring instead the simple term "payments". Remember also that Facebook does a 70/30 revenue split with developers, implying that the $557M in 2011 payments-related revenue came from $1.867 billion in Facebook Credit redemptions.

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