Facebook easily beat expectations again
Global social media giants, Facebook, are reliable for a lot of things. You’ll always find photos of friends and family, the latest news, and more recently – incredible business performance. This pattern shows no signs of changing now that they have revealed their fourth quarter fiscal figures.
Whenever Facebook reveals their earnings, it receives an awful lot of coverage for a number of reasons. They are a company that many people interact with on a daily basis. They are also one of those select few companies that are looked to as more than a company, they are a glowing example of how quickly and successfully an idea can grow.
For the three months ending 31 December 2016, Facebook posted revenue of $8.8 billion, which was a staggering 51% up on the same period the previous year, which brought in $5.841 billion.
It is important, when looking at Facebook’s revenue, to note just how much of this is made up solely by advertising. Out of the $8.8 billion revenue the Silicon Valley firm earned during Q4, $8.629 billion of this was made up by advertising.
Mark Zuckerburg’s company have put a heavy focus on mobile in recent years. Hannah Kuchler, writing in The Financial Times, has looked at this area. She reports:
‘When Facebook prepared to go public five years ago, its plan to boost its then minuscule mobile revenue was to put adverts in users’ newsfeeds. Cautious about putting people off using the app, it promised just one ad per user per day. Fast forward to the fourth quarter of 2016, the newsfeed plan has paid off. Mobile contributed 84 per cent of revenue.’
Facebook, of course, also released their figures for the full fiscal year, which were similarly impressive. Revenue for the full year came in at $26.885 billion, which was up 57% from the figure from the previous year, showing phenomenal growth.
In terms of net income for the full year, Facebook brought in $10.217 billion, which was up a staggering 177% year over year. This huge increase results in a 171% increase in diluted earnings per share of $3.49.
In terms of operational highlights from across the year, the number of daily active users (DAUs) was 1.23 billion on average fro December 2016, which was up 18% year on year.
Speaking concisely on his company’s performance, Zuckerburg, founder and CEO of Facebook, said: “Our mission to connect the world is more important now than ever, Our business did well in 2016, but we have a lot of work ahead to help bring people together."
Dominion holds Facebook in its Global Trends Ecommerce Fund.
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