Facebook trounces Wall St estimates with sharp ad sales growth

Jul 28, 2016, 01:47
Facebook trounces Wall St estimates with sharp ad sales growth

The social media juggernaut reported that its Messenger app user base has reached over 1 billion, which represents a considerable improvement compared to 1.71 billion on its flagship platform.

If you needed more proof that Facebook is absolutely crushing it on mobile, consider this: More than a billion people now check Facebook from their phones every single day.

That's more than the combined population of the USA and China - a market that Facebook hasn't even cracked yet. The company also took steps in Q1 to boost user engagement, re-ranking its news feed to more prominently display content from friends and family. Total revenue amounted to $6.4 billion, a gain of 59%, with advertising accounting for $6.2 billion of that, a jump of 63% from last year's figure of $3.8 billion.

Facebook and Google are the clear leaders in the digital advertising space, claiming more than 40 percent of the market between them, according to advertising analysis firm eMarketer. In the USA and Canada, that value goes up to $14.34 per user, up from $9.30 from the same period past year.

All of that comes in stark contrast to Twitter, which reported this week that its user growth is stalled around 300 million.

Advertisers are flocking to Facebook because its popularity among users of social networking remains unrivaled.

Facebook Inc. (NASDAQ:FB) stock gained over 6% during the post-market hours today, after the company announced second quarter of fiscal 2016 (2QFY16) earnings report.

The consensus on earnings per share minus items is 81 cents, up 62%.

Time spent on its suite of apps, including the main Facebook app, Instagram and Messenger, increased "double digit percentages", Chief Executive Mark Zuckerberg said on a conference call with analysts.

Facebook is expected to generate more than $25 billion in revenue this year. Facebook has been working to get users to create and watch more videos, from each other, from businesses and from celebrities. Fewer people are sharing "long, full photo albums", according to Zuckerberg.

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