As the number of Facebook users continue to rise, so does its advertising revenue — especially on mobile.
Facebook’s ad revenue grew 53 percent in the quarter ending Dec. 31.
Revenues for the quarter were $8.8 billion, with total revenues for the year at almost $27 billion, up 57 percent. Facebook monthly active users were at more than 1.8 billion, with monthly active users on mobile making up the bulk of that at more than 1.7 billion. Fittingly, mobile advertising revenue made up approximately 84 percent of advertising revenue for the quarter, up from 80 percent at the same time last year.
Facebook chief operating officer Sheryl Sandberg said on a conference call with analysts that 65 million businesses use Facebook’s free page products and that 4 million businesses are advertising on the platform. On Instagram, there are 5 million Instagram Business Profiles and 500,000 advertising business.
Sandberg said that this meant that the revenue base was becoming more diverse — but it shows opportunity for growth.
Instagram recently started inching closer to adding in “buy” buttons to more posts, and on that, Sandberg said the core business is about connecting people with what they care about and that she was looking at getting the right message at the right time. She said that features such as the “buy” button and Facebook Marketplace are “aimed at improving some of the experiences that people were trying to have already organically on Facebook, but the core of our focus is still very much focused on ads.”
Mark Zuckerberg, Facebook founder and chief executive officer, spoke frequently of Facebook’s push into video in the short term and virtual reality in the longer term, saying that investing in content was the key to encouraging adoption of new platforms and ways of using Facebook.
He also asked the investment community for patience, sticking to the 10-year timeline he anticipated for VR, and that content development was progressing “at a reasonable clip.
“The analogy that I always use is that smartphones came out in 2003 and it took 10 years to get to one billion units. And if we can be on a similar trajectory of anywhere near 10 years for VR and AR [augmented reality], then I would feel very good about that…. We’re going to invest a lot in this and it’s not going to be really profitable for us for quite a while.”
Zuckerberg also pointed out that the day marked the fifth anniversary of Facebook filing for an initial public offering, and emphasized that the mission of giving everyone a voice was the same.
He also acknowledged Facebook’s ongoing relationship to the news.
“We are focused on building a more informed community,” he said. “We don’t write the news.”
He added that while in the past, the social network was focused on reducing spam and clickbait, it is now looking at ways that make it easier to report and identify misinformation.
“Our mission to connect the world is more important now than ever,” Zuckerberg said. “Our business did well in 2016, but we have a lot of work ahead to help bring people together.”