NEW YORK - Facebook's finance chief, Gideon Yu, is leaving the fast-growing social-networking site as the company looks for a replacement with "public company experience."
It's the latest sign that the site may be looking to go public in the not-so-distant future, though the company has said it has no immediate plans for an initial public offering.
Palo Alto, Calif.-based Facebook said Tuesday that Yu, 37, has played an important role in establishing the company's core financial operations. He became Facebook's CFO in July 2007 after stints with Yahoo Inc., Google Inc.'s YouTube and a venture-capital firm. At YouTube, Yu helped negotiate the site's sale to Google in a deal valued at $1.76 billion when it closed in 2006.
Facebook, which is nearing 200 million users worldwide, said that despite the recession it is pleased with its financial performance and that it's in a good position for its next stage of growth.
A person close to the matter, who asked not to be named because privately held Facebook typically does not disclose financial details, said the company is on track to grow its revenue by 70 per cent this year. And Facebook expects to generate positive cash flow, an important measure of a company's financial health, by 2010.
The company has also been profitable by one measure -- earnings before interest, taxes, depreciation and amortization, or EBITDA -- for the past five quarters.
It is not clear how much Facebook would be worth if it were to go public. In 2007, an investment by Microsoft Corp. implied a market value of $15 billion. Facebook has noted, however, that Microsoft's investment, which was for preferred stock, does not necessarily compare with what the company's common shares would be worth on the open market.
A court hearing last June revealed that Facebook's own appraisal had priced its privately held shares at $8.88 each, giving the company a market value of roughly $3.7 billion.
Facebook's 24-year-old founder and chief executive, Mark Zuckerberg, has said in the past that the company is open to additional investors, but it has to be at the "right valuation." But the company is not saying what this valuation would be.
Nick Einhorn, research analyst at Renaissance Capital, said that if Facebook were to go public, it probably would not be anytime soon given the poor state of the overall IPO market. Companies that aren't about to run out of money are more likely to hold off going public until market conditions improve.
Businesses planning an IPO must also prove that they are viable.
"It's not enough to say in this market that 'we are growing a lot,'" Einhorn said, adding that while five-year-old Facebook is certainly not brand new, it needs to prove that its business model can be profitable over the long term.
Einhorn said it's still unclear whether social networking -- Facebook and others like Twitter -- can be sustainable and generate long-term profitability.
