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Facebook profit powers past forecasts at $425 million
Highlights
Facebook Profit Powers Past Forecasts At $425 Million, Facebook Profit, Facebook Profit Up. Facebook on Wednesday announced strong earnings on the back of soaring advertising revenue, nearly half of it from smartphones or tablet computers.
SAN FRANCISCO: Facebook on Wednesday announced strong earnings on the back of soaring advertising revenue, nearly half of it from smartphones or tablet computers. The world's leading online social network reported profit of $425 million in the quarter that ended on September 30, compared with a loss a year earlier of $59 million.
The third quarter results for the California-based firm were well ahead of most forecasts, with revenues rising 60 percent from a year ago to $2.016 billion. The company also disclosed increases in the number of users to 1.19 billion.
Facebook shares jumped more than nine percent to $53.43 in after-market trades that followed release of the earnings figures. "For nearly 10 years, Facebook has been on a mission to connect the world," said co-founder and chief executive Mark Zuckerberg.
"The strong results we achieved this quarter show that we're prepared for the next phase of our company, as we work to bring the next five billion people online and into the knowledge economy." The number of people who use the social network daily in the quarter was 728 million in a 25 percent increase from the same quarter a year earlier, according to Facebook.
About 1.19 billion people used Facebook monthly in a rise of 18 percent from the same period in 2012, the company reported. Meanwhile, the ranks of Facebook members connecting to the social network with mobile devices at least once a month soared 45 percent to 874 million people.
On average, more than a half-billion people daily accessed Facebook using smartphones or tablets, according to the earnings report. Advertising revenue in the quarter rose to $1.8 billion, up 66 percent from the same period a year earlier.
Some 49 percent of that advertising money was made on marketing messages delivered on mobile devices. The figure promised to appease investors keen to make sure Facebook's business model is adapting to the trend of modern lifestyles increasingly revolving around accessing the Internet using smartphones or tablets.
Shares in Facebook struggled after the company's keenly anticipated public offering in May 2012. The stock fell by some 50 percent last year, before turning sharply higher and hitting record levels in recent weeks.
Facebook is expected to take a 5.41 percent share of all global digital ad revenues this year compared with the 32.84 percent stake going to Google, according to industry tracker eMarketer.
Meanwhile, the social network was forecast by eMarketer to end the year with a 15.8 percent share of mobile ad spending worldwide while Google lays claim to a dominant 53.17 percent of the $16.65 billion market.
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