Facebook revenue jumps 60% to $2.02bn in Q3

Facebook revenue jumped by 60% to $2.02 billion in Q3 2013. The company reported a profit of $425 million for the quarter. During after-hours trading, when figures were released, Facebook shares rose by 15%.

Since announcing in July this year that Facebook revenue was progressively consisting of more mobile advertising, its shares have almost doubled in value.

Facebook founder, Mark Zuckerberg, who is also the company’s CEO, said:

“For nearly ten years, Facebook has been on a mission to connect the world. 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.”

At $2.02bn for Q3 2013 Facebook revenue was 60% higher than $1.26bn in Q3 2012.

Facebook revenue from advertising rose sharply

  • Advertising revenue rose 66% to $1.80bn, compared to the same period last year.
  • Forty-nine percent of this advertising revenue came from mobile advertising.
  • Payments and income from other fees totaled $218 million for Q3 2013.
  • In September 2013 there were on average 728 million DAUs (daily active users), 25% more than in September 2012. Mobile DAUs totaled 507 million.
  • MAUs (monthly active users) totaled 1.19 billion as of September 30th, 2013, a year-over-year increase of 18%.
  • A total of 874 million MAUs were mobile users, 45% more than a year ago.

Facebook revenue must come from mobile ads, analysts said

Analysts have long been saying that getting more mobile ads is the secret to future success for the majority of companies whose incomes are totally or mainly dependent on the Internet.

By increasing its number of mobile users, Facebook has been able to sell more ads through that medium.

Last year Facebook’s share of the mobile ad market was 9% – it is now 14.9%.

Adverts in mobiles are quite different from those on desktop platforms, where the reader is exposed to ads in the right column of his or her screen. In mobile platforms the new feeds are not free of commercial messages.

As there is not enough space on the mobile screen to place ads on the right, they appear directly in the news feed.

In an interview with CIO Journal, Ken Rudin, Facebook’s analytics chief, said mobile advertising business owes a great deal to the company’s use of Big Data. Rudin said “We didn’t know what would happen if ads were placed in the mobile news feed. So we ran experiments on desktops……and watched what happened … to see if people engaged with the ads. It turned out, it worked quite well.”

On October 19th, 2013, Market Business News reported that Google achieved a profit of $2.97 billion for Q3 2013.