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Sales rose 32 percent to $1.26 billion during the third quarter, Menlo Park, California-basedFacebook said yesterday in a statement. That compares with the average estimate of $1.23 billion, according to data compiled by Bloomberg. That also matched the growth rate of the second quarter, snapping a streak of slowing sales increases.
Ads delivered to people on mobile devices generated about $150 million during the quarter, or 14 percent of all advertising revenue. Photographer: Jason Alden/Bloomberg
Ads delivered to people on mobile devices generated about $150 million during the quarter, or 14 percent of all advertising revenue. That compares with about $10 million in the second quarter, according to an estimate by Brian Wieser, an analyst at Pivotal Research Group. Chief Executive Officer Mark Zuckerberg is showing early success with the more than a half dozen services unveiled since March that are designed to help businesses woo social-network users on tablets and smartphones.
‘What Problem?’
“Mobile problem? What mobile problem?” Wieser said. “It’s nothing short of remarkable.” Profit excluding certain costs was 12 cents a share in the third quarter. That compares with the average estimate of 11 cents a share. Facebook had a net loss of $59 million, or 2 cents a share, compared with profit of $227 million, or 10 cents, reflecting a larger provision for income taxes. Facebook gained as much as 14 percent to the equivalent of $22.13 in German trading as was up 12 percent as of 9:59 a.m. in Frankurt. In late U.S. trading yesterday, the stock had surged 13 percent after gaining less than 1 percent to $19.50 at the close in New York. The stock has fallen 49 percent since the initial public offering in May.
Moving ‘Quickly’
The company had lost more than $40 billion in market value since holding the largest Internet IPO on record as investors fretted that it won’t quickly ramp up mobile-related sales. Arvind Bhatia, an analyst at Sterne Agee & Leach Inc. in Dallas, had predicted that only 5 percent of Facebook’s ad sales would come from mobile. “They still have a long way to go to prove that this is sustainable -- they can keep going in this direction, but what it shows is that things can move relatively quickly,” he said.
With mobile-marketing making gains, the number of ads being shown kept pace with the growth in users during the quarter, Facebook Chief Financial Officer David Ebersman said during a call with analysts yesterday. Ad prices increased 7 percent, while the number of ads delivered increased 27 percent. ... Read more.
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