Facebook Beats Expectations In Q4 With $8.81 Billion Revenue

Facebook Beats Expectations In Q4 With $8.81 Billion Revenue
Facebook beat growth targets across the board despite running out of room to place ads in the News Feed. The social network had another strong quarter in 2016, earning $8.81 billion in revenue and $1.41 EPS. Photo : Alltime Numbers/YouTube

On Wednesday, Facebook reported a remarkable fourth quarter, as mobile ads drove a 50% jump in its revenue that far outpaced the company's spending. As the social network moves closer to garnering an unusual audience of a total of 2 billion monthly users. Facebook reiterated that it expects its advertisement revenue growth rate will "come down meaningfully" this year.

Facebook Beats Expected Revenue In Q4

Earnings of Facebook were up from 79 cents per share on $5.84 billion in revenue, as reported in the year-earlier period. The company shares its rose for as much as 3 percent after hours but were last up less than 1.5 percent. Facebook's ad business zoomed higher for the past year as retailers poured money into snagging consumers during the holiday season.

Only Google challenges Facebook when it comes to any digital advertising dominance. "That's just massive earnings growth," Danielle Hughes, CEO of Facebook-shareholder Divine Capital, told CNBC's "Closing Bell" on Wednesday. "Same thing for EPS." At the same time, Facebook's virtual reality company, which is named as Oculus, is on the hook for having an approximate $500 million after losing a key lawsuit.

Early this week, Facebook's Oculus lost a case against the game maker company ZeniMax, leaving the tech giant on the hook for $500 million. ZeniMax sued Oculus, which is owned by Facebook, for allegedly stealing its intellectual property. The company said that Oculus founder Palmer Luckey "commercially exploited" the computer code of Zenimax and trade secrets in order to develop a specific product.

Facebook had a great revenue for Q4 2016, earning $8.81 billion in total and $1.41 EPS. It pulled that from 1.86 billion monthly users, up 3.91 percent this recent quarter, or 70 million users, from 1.79 billion. But at a slower pace than its 4.67 percent growth last quarter. Mobile now makes up 84 percent of its ad revenue, the same as the past quarter, accounting a total of $7.248 billion, signaling that Facebook has triumphantly completed its shift to mobile.

Facebook Will Continue To Make A Hit

According to TechCrunch, all of Facebook’s engagement, hard work, and ad targeting is paying off. It was reported to reach a massive of $19.81 average revenue per user in the U.S. and Canada. Globally, it hit $4.83 average revenue per user (ARPU). That means it’s total earning is near $20 per user annually.

The ad revenue of Facebook exploded in the first half of the year, crushing estimates, as Facebook surpassed more than a billion monthly users on many of its major platforms. These platforms include other social networks or apps such as Facebook Messenger, Instagram, and WhatsApp. Facebook's video ambitions and daily engagement are in the spotlight too.

Later last year, Facebook has announced the company's plans to invest in original contend and licensed video to impressively add ads in between its live streamed content. The company also added new advertising options on Instagram, especially on its Snapchat-like product. Aside from that, Facebook Messengers also experienced a lot of updated features recently that is believed to be more and more useful.


© 2021 iTech Post All rights reserved. Do not reproduce without permission.

More from iTechPost