Slack posts $141 million annual loss as it files to go public

(Reuters) – Slack Technologies, operator of the popular workplace instant-messaging app, reported an annual loss of $140.7 million, the company said on Friday ahead of its planned public market debut.

Slack’s daily active users exceeded 10 million in the three months ended Jan. 31, 2019, with its paid users at about 88,000, the company’s regulatory filing bit.ly/2vp05DG showed.

The San Francisco-based company is seeking to go public via a direct listing, making it the second big technology company after Spotify Technology SA to bypass the traditional route of listing its shares through an initial public offering.

A direct listing is a cheaper way of becoming a public company as the process requires fewer investment banks and therefore lower fees.

In a direct listing, however, a company does not sell any new shares to raise money. Instead, it gives existing shareholders the opportunity to cash out.

The company is hoping for a valuation of more than $10 billion in the listing, Reuters had previously reported. Some early investors and employees have been selling the stock at around $28, valuing the company close to $17 billion, Kelly Rodriques, CEO of Forge, a brokerage company, told CNBC on Thursday.

The company expects to trade on the New York Stock Exchange under the symbol “SK”,

Slack’s revenue jumped 82 percent to $400.6 million in its latest fiscal year and its loss narrowed to $140.7 million from $181 million a year earlier.

The company, whose competitors include Microsoft Teams, a free chat add-on for Microsoft’s Office365 users, said it expects to incur losses for the foreseeable future and may not achieve or maintain profitability in the future.

Slack is the latest in a string of high-profile technology companies looking to go public this year. Lyft Inc, Pinterest and Zoom Video Communications have completed IPOs so far in 2019.