Remember the days when Facebook was criticised for failing to make enough money from mobile advertising? The social network’s latest financial results emphasised how far in the past those days are.
Here’s what we learned from the results, and the ensuing earnings call with financial analysts.
1. No Facebook-flight just yet
No mass exodus shown in the numbers, even if growth is slowing. Photograph: Alamy
Despite regular predictions that Facebook is about to peak and (possibly) head into a Myspace-like decline, it continues to grow.
“Time spent per person per day across our services [grew] this quarter by more 10% compared to last year,” said Facebook’s chief executive, Mark Zuckerberg. “And that doesn’t even include WhatsApp, which joined us late last year.”
Last quarter, Facebook had 1.39 billion monthly active users and 890 million daily active users – up 13% and 18% respectively compared to a year ago, even if its quarterly increases are smaller these days than they were.
2. Video is growing fast for Facebook
Should Google be worried about Facebook’s massive growth in video? Photograph: Samuel Gibbs/The Guardian
Watch out, YouTube: Facebook is parking its tanks on your lawn. “Video grew significantly this year, to an average of more than 3bn video views per day on Facebook,” said Zuckerberg.
Startling, considering that when his company last announced a video milestone in September 2014, it was 1bn daily views. These are views of videos uploaded directly to Facebook, too; they don’t include views of embedded YouTube videos, for example.
“Today, over 50% of people in the US who come to Facebook daily watch at least one video per day and globally over 65% of Facebook video views occur on mobile,” said the chief operating officer, Sheryl Sandberg. “We are certainly exploring some premium content.” She adds that the video being uploaded by Facebook users (including celebrities and brands) is providing plenty of growth for now.
3. Mobile is still driving Facebook’s business
Facebook’s mobile use is growing and earning the company money. Photograph: Rui Vieira/PA
Facebook had 1.19 billion mobile monthly active users in the final quarter of 2014, which equates to more than 85% of its total users, and it counts 745 million people as mobile daily active users.
“Mobile remains the primary driver of our growth,” David Wehner, chief financial officer, told analysts. Mobile accounted for 69% of the company’s $3.59bn of advertising revenues in the quarter, up from 53% a year ago. There’s even more potential in Facebook’s 300 million Instagram users, who could soon see video ads, 500 million Facebook Messenger users and 700 million WhatsApp users too.
4. Watch out for Facebook’s search ambitions
Facebook Graph Search
Facebook’s next battleground could be search. It’s clearly a long-term priority, with Zuckerberg describing it as “another important effort that we expect to create a lot of value over the next few years”.
“We’re on this multi-year voyage to basically index all the content and make it available to people and rank it well,” he said. That will put it on a collision course with Google, if plans for video domination haven’t already. Zuckerberg talked up its billion-a-day searches, Graph search and Post search, all small fry in Google terms, so far.
5. Facebook in virtual reality
Convincing ordinary people to use VR headsets is a challenge. Photograph: Anthony Devlin/PA
Having spent $2bn on the company , Zuckerberg is hell-bent on persuading westerners to buy and use Oculus Rift virtual reality headsets. But it won’t be any time soon as it falls into the “10-year plans”.
“Oculus continues to make progress towards the future of immersive VR experiences that are part of daily life for millions of people,” said Zuckerberg, failing to give any information on when non-developers will be able to actually buy one. How Facebook is going to actually plug into a VR headset is still as clear as mud.
6. Connecting the next billion people
Zuckerberg wants to connect the next billion people to the internet, who can then all join Facebook. Photograph: Chandan Khanna/AFP/Getty
Facebook’s other long-term plan is its Internet.org initiative, which is aimed at getting the next billion people who don’t have access to the internet online.
Zuckerberg pointed to Zambia, Tanzania, Ghana, Kenya and Colombia as flagship countries for Internet.org, saying Facebook has already got six million people online who previously had no internet access.
That sounds noble, but for Facebook to continue growing beyond the 20% of the world’s population it already claims, it’ll need more people online.
7. How much are you worth to Facebook?
How much are you worth to Facebook? Less than a gold bar, sadly. Photograph: Sebastian Derungs/AFP/Getty
The financial reports also tell us how much each person on Facebook is worth to the company, which varies by country.
A user in the US or Canada was worth $9 in the final quarter of 2014, but Europeans were only worth $3.45 and users in Asia-Pacific $1.27. Users in the rest of the world including Africa and Latin America – which is the big potential growth area – were only worth 94 cents.
Of course, as advertising revenue grows, each person outside the US might be worth more, though users themselves are unlikely to benefit: the time has not yet come when they can cash out their work to Facebook.
This article originally appeared on guardian.co.uk