Facebook’s prioritization of mobile ad revenue paying off

Jeremiah Yap – Fourth Estate Cooperative Writer

Mountain View, CA, United States (4E) – In its fourth quarter earnings report, Facebook shared that an estimated 23 percent — $305 million — of its ad revenue is derived from mobile. Mobile users have also increased by 57 percent from last year and now have about 680 million active mobile users.

In the third quarter of last year, Facebook reported that only 14 percent of its ad revenue was from mobile.

“In the third quarter and the first nine months of 2012, mobile advertising revenue as a percentage of adverting revenue was 14% and 6%, respectively. As mobile advertising was not offered prior to the first quarter of 2012, comparisons to prior year are not meaningful,” Facebook stated in its third quarter 10-Q filing.

The biggest social media website in the world recorded $1.585 billion in revenue in the last quarter of last year — an increase of 40 percent. Majority of the revenue came from advertising.

“Analysts believed that today’s earnings were going to be impressive due to improved monetization of its mobile ads,” The Next Web reported.

Facebook has enhanced mobile user experience by offering Facebook Messenger to users without phone numbers.

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  1. nativeson

    Thanks for your interesting and perceptive comment.

    As a FB shareholder, I’m inclined to agree but remain optimistic, because the company is making such heavy investments in finding new ways to increase revenue and profitability. That’s what truly great companies do, a factor that most investors and, especially, analysts don’t much appreciate because their outlook rarely extends beyond their noses – sniffing out, as they do, a quick buck short-term. I’m in for the long haul.

    Still, I enjoyed reading your rational observation. But then, we both likely know that there is nothing rational about the stock market. Take Apple, for example. Just produced astounding results for the quarter and the stock falls 30 points in one day!

    Ouch!

  2. mooper

    The focus on mobile doesn’t help them at all if they can’t increase revenue per user. They failed miserably in that respect, hence the stock plummet today. Have you ever clicked on a Facebook ad and spent money with the advertiser? Neither have I. That’s their problem. They are attracting some advertisers to buy ads right now because they *think* they will see a return, but user revenue is stagnant and won’t go up much because people don’t use FB with the intent to shop. They use it to share, play around, socialize. Great company, will remain profitable, but not remotely to the degree the stock valuation implies. This is the next Groupon.

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