Skip to footer

Facebook is profitable, despite what you hear

Facebook has been growing since its IPO last year, and advertising revenue for the company increased 61 percent from last year. Facebook is making a lot of money now and starting to deliver on the promise of its IPO.

|
Ben Margot/AP/File
A sign seen at Facebook headquarters in Menlo Park, Calif. Facebook reported quarterly earnings on Wednesday, July 24, 2013, and the company has raised its advertising reveue considerably since going public last year.

The narrative since the Facebook IPO has been that the company had done the bulk of its growth prior to coming public and the valuation had already reflected it.

Advertisers were not "getting" the platform or particularly excited by the prospect of branding as opposed to the more performance-driven click-and-buy-something they get from Google.

In addition, mobile was going to be a headache for the company because even if they "figured it out", a mobile click was not worth as much as a desktop one.

This morning the stock opened higher by 30% because they have largely been able to do the most important thing - demonstrate profit growth despite these "headwinds."

In my mind, the most important stats are these two (via CNET):

More than 1 million active advertisers. Facebook's bread and butter. The company said there's a lot of growth here, with local businesses leading the charge.

$1.81 billion in revenue. As expected, the biggest chunk of the revenue, $1.6 billion in fact, came from advertising. Advertising dollars increased by 61 percent from last year. About 41 percent of that $1.6 billion came from mobile advertising. The rest of the revenue, $214 million, came from payments and other fees. This figure mostly reflects money from game payments, which Facebook said are up by 7 percent.

That's a business, guys.

Facebook is making a lot of money now and starting to deliver on the promise.

The long-term negative is that I still think the company becomes AOL as new generations skip it and go right into buildng their own networks and sites outside of the walled garden. But that's a ways off and in the meantime, a billion users is a billion users.

You've read  of  free articles. Subscribe to continue.
Real news can be honest, hopeful, credible, constructive.
What is the Monitor difference? Tackling the tough headlines – with humanity. Listening to sources – with respect. Seeing the story that others are missing by reporting what so often gets overlooked: the values that connect us. That’s Monitor reporting – news that changes how you see the world.
editor@csmonitor.com
Subscribe
Mark Sappenfield
Editor

Dear Reader,

About a year ago, I happened upon this statement about the Monitor in the Harvard Business Review – under the charming heading of “do things that don’t interest you”:

“Many things that end up” being meaningful, writes social scientist Joseph Grenny, “have come from conference workshops, articles, or online videos that began as a chore and ended with an insight. My work in Kenya, for example, was heavily influenced by a Christian Science Monitor article I had forced myself to read 10 years earlier. Sometimes, we call things ‘boring’ simply because they lie outside the box we are currently in.”

If you were to come up with a punchline to a joke about the Monitor, that would probably be it. We’re seen as being global, fair, insightful, and perhaps a bit too earnest. We’re the bran muffin of journalism.

But you know what? We change lives. And I’m going to argue that we change lives precisely because we force open that too-small box that most human beings think they live in.

The Monitor is a peculiar little publication that’s hard for the world to figure out. We’re run by a church, but we’re not only for church members and we’re not about converting people. We’re known as being fair even as the world becomes as polarized as at any time since the newspaper’s founding in 1908.

We have a mission beyond circulation, we want to bridge divides. We’re about kicking down the door of thought everywhere and saying, “You are bigger and more capable than you realize. And we can prove it.”

If you’re looking for bran muffin journalism, you can subscribe to the Monitor for $15. You’ll get the Monitor Weekly magazine, the Monitor Daily email, and unlimited access to CSMonitor.com.

Subscribe to insightful journalism

QR Code to Facebook is profitable, despite what you hear
Read this article in
https://www.csmonitor.com/Business/The-Reformed-Broker/2013/0726/Facebook-is-profitable-despite-what-you-hear
QR Code to Subscription page
Start your subscription today
https://www.csmonitor.com/subscribe