Facebook increased its revenues by half due to growth in advertising sales

27.01.2016

Facebook Company surprised investors reporting an increase in quarterly earnings by 52 % due to growth in advertising sales aimed at the rapidly growing number of users of Facebook mobile applications.

Total revenue of the American company in the fourth quarter rose to $ 5.84 billion from $ 3.85 billion a year earlier. Revenues from advertising rose 56.8 % to $ 5.64 billion during the holiday shopping when companies start to spend more on advertising.

Excluding certain items, the company earned 79 cents per share, versus averaged forecast of analysts polled by Reuters, who expected a profit of 68 cents per share and revenue of $ 5.37 billion.

The impressive results of the world's largest social network bleak contrast with the results of technology companies such as Apple (O: AAPL) and eBay, which have suffered due to the global economic uncertainty and a strong dollar which puts pressure on the currencies of other countries.

For example, Apple Inc (O: AAPL) in the first quarter of 2016 fiscal year recorded a record slow growth in sales of iPhone since the launch of smartphones in 2007. In the current financial quarter Apple expects the first decline in revenue since 2003, the rate of decline will be the maximum in 2001, which talks about the end of its period of rapid growth.

"It's phenomenal that Facebook has achieved such growth under these conditions (in the currency market)," - said an analyst at MKM Partners, Rob Sanderson.

Facebook shares jumped nearly 12 % after the close of the official session.

According to the company, the advertising for mobile applications accounted for 80 % of all advertising revenue in the last quarter compared to about 78 % in the third quarter and 69 % a year earlier.

"It is much more growth than we expected," - said an analyst at Evercore ISI, Ken Sina.

By the close of Wednesday trading, growth of Facebook shares over the past 12 months amounted to nearly 25 %.

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