Facebook has once again delivered some strong earnings results for the third quarter 2016. Advertising sales increased by 56% to $7bn during the quarter, largely driven by mobile ads at $5.7bn. Indeed, mobile ad revenue rose 70% and now represents 84% of the company’s total ad sales. Net income shot up 166% from last year to $2.38bn.
Facebook earnings driven by mobile (once again) in Q3 2016
In addition, the company announced that it had now surpassed one billion mobile-only monthly active users. And that’s partially why Facebook is making such huge sums from mobile ads. Advertisers are fully aware that consumers are using their smartphones 24/7 and with Facebook being one of the top apps on mobile, it makes sense to run campaigns here.
During the company’s earnings call, Mark Zuckerberg focused on future innovations driving the business. He said:
“I want to start by talking about our work around putting video first across our apps.”
Indeed, Facebook believes that video will be driving online consumption in just five years time and Zuckerberg wants to catch a large chunk of the pie before competitors do. Video advertising is lucrative and has already been hailed as the new ‘TV’. He adds:
“People are creating and sharing more video, and we think it’s pretty clear that video is only going to become more important. So that’s why we’re prioritizing putting video first across our family of apps, and taking steps to make it even easier for people to express themselves in richer ways.”
Other areas of innovation include virtual reality and mobile messaging.
Following its earnings announcement, shares dropped 8% over fears that revenue growth could be slowing down in 2017.