By Adam Fraser.
Another stellar set of quarterly results from Facebook. The juggernaut powers on based on pretty much any metric you can look at.
If you want to dive into detail, you can find the detailed financials, investor presentation and management conference call. For those without the time to digest all of this, here are 10 key soundbites from the results:
- Monthly active users have reached 2.01bn from 1.93bn last quarter (3.6% growth) and 1.71bn a year earlier (17.2% growth)
- Daily active users hit 1.32bn from 1.28bn last quarter (3.2% growth) and 1.13bn a year earlier (17.5% growth)
- Instagram now has over 700m monthly users, with over 250m using the Instagram Stories feature daily (making it larger than Snapchat Stories). Interestingly WhatsApp Stories also has more than 250 million people using it daily
- There are now over 70 million businesses on Facebook and over 15 million Business Profiles on Instagram.
- Video continues to increase in importance as a medium. COO Cheryl Sandberg confirmed “More video is being shared and watched on Facebook than ever before”
- Total revenue was $9.3bn (exceeding market expectations) versus $8.0bn in the prior quarter (a massive 16% increase) and $6.4bn a year earlier (44.8% growth) – generating a net profit of $3.9bn (reminder – in a single quarter!)
- Facebook has reasonably balanced global spread with just under 50% of revenue coming from USA and Canada, a ratio that has remained reasonably consistent over the past 4 quarters
- Average revenue per user increased by over 11% in one-quarter, hitting $4.73 from $4.23 last quarter and $3.82 a year ago; note revenue per user is significantly higher in the USA/Canada ($19.38) compared to Europe ($6.28) and the Rest of The World ($1.48)
- Facebook ended the quarter with a cool $35bn in cash – enough to buy Twitter approximately three times over
- Some interesting random stats: Facebook has over 20,000 employees, 43% higher than a year ago; both Facebook Messenger and WhatsApp have over 1.2bn active users; mobile ad revenue is 87% of total ad revenue; Facebook data on a brand campaign showed 6 second ads outperformed 15 and 30 second ads in terms of brand metrics; there are 5m advertisers on Facebook and 1m on Instagram.
Note, mobile usage of Facebook has now become so prevalent Facebook no longer separately discloses mobile users – whilst it did, the number of users accessing via a mobile device was consistently over 90%
An interesting quote from Mark Zuckerberg on AI:
“AI can help you figure out who will be most interested in [an ad]. You don’t even need to target now because AI can do it more precisely and better than we can manually. This makes the ads you see more relevant for you and more efficient for businesses.”
With revenue growth, user growth, strong margins and consistent cash flow, this is another incredible set of quarterly results.
Possible clouds on the horizon? Ad revenue is 98% of total revenue hence there is no diversity in income types. if ad blocking technology ever penetrated Facebook’s walled garden this clearly would be a massive threat to Facebook’s earnings.
Privacy stoushes always loom large but never seem to bite.
For now, it’s all blue skies.