Facebook announced Wednesday that it blew past investor estimates in its fourth quarter earnings, jumping to $3.57 billion in profit, mostly due to mobile advertising growth. In total, advertising revenue grew 53%, and 84% of its total advertising revenue growth in Q4 came from mobile. In an interview with TechCrunch, Facebook's Chief Finance Officer David Wehner also said the tech giant added more users in Q4 than any in its history.
By the numbers, via CNBC:
What a difference five years makes ....
For investors: Shares elevated to about three percent after the earnings call. Per Yahoo!, Facebook shares rose after seven of its previous 12 earnings announcements, and Facebook's adjusted earnings per share have now topped estimates for the last 13 quarters.
What matters: Heavy advertising growth, particularly on mobile, should help to relax investor concerns over major investments in virtual reality and augmented reality technologies, as well as big acquisitions like WhatsApp. But Facebook warned investors they should still continue to expect ad revenue to "come down meaningfully" in 2017, as the company works through ways to monetize video while newsfeed inventory continues to plateau. Earnings were announced shortly after Facebook lost a $500 million virtual reality headset case against ZeniMax Media Inc. for stolen technology. Mark Zuckerberg asked investors to be patient as the company continues to make large-scale investments in new technologies.
