Twitter has filed paperwork with US regulators, as it sets its sights on a stock market flotation.
The move is the first step towards going public.
The microblogging tool, which allows users to send out streams of 140 character messages, has been valued by private investors at more than 7.5 billion euros. It should break even this year and is said to be on track for 40 percent annual growth.
Launched seven years ago, Twitter has become a big hit around the world – used by governments, organisations and individuals. It has more than 200 million regular users, contributing more than 400 million posts a day.
The company makes money by inserting paid, targeted adverts which resemble ordinary, user-generated content.
Twitter was one of the first to prove that in-stream adscould be a viable way to make money in the mobile era.
“There was a lot of concern about whether they’d ever be able to insert advertising into their site,” said Forrester analyst Nate Elliott. “They’ve shown it can be effective. They offer in many ways better measurement for marketers than larger companies like Facebook.”
Social networking site Facebook was listed on the stock market in May last year.
It created a big buzz to begin with, but then its share price plunged.
Facebook has since been able to claw its way back and its stock reached a record high this week.
Twitter’s success with its advertising model created a new model for mobile advertising and prompted Facebook last year to adopt a similar ad product, called Sponsored Stories.