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Facebook profits triple as mobile ads smash expectations

Facebook has beaten analysts’ estimates for quarterly revenue on and forecast similar growth ahead, as businesses used its digital ads tools despite a brand boycott and the economic upheaval of the coronavirus pandemic.

Facebook shares have jumped after reporting a tripling of first quarter profits from a year earlier to $1.51bn, boosted by a huge increase in mobile.

Back in 2012, Facebook made no revenues from mobile- now the social network dominates the smartphone ad market.

Total revenue rose to $5.4bn from $3.5bn while daily active users hit 1.1 billion on average in March – up 16% – with those using mobile devices nearing the one billion mark at 989 million.

That represented an increase of 24%, Facebook said, adding that it was also making more from mobile ad revenues.

Advertising revenues rose to $5.2bn, with more than 80% coming from mobile.

Facebook’s focus on live video attracted new advertisers, while sales on existing services also grew.

The first quarter numbers beat analysts’ forecasts in all the key metrics with the social network, also behind Instagram, reporting net profits of $1.5bn compared to over $500m in the same period last year.

Facebook founder Mark Zuckerberg told investors: “We had a great start to the year. We’re focused on our 10-year roadmap to give everyone in the world the power to share anything they want with anyone.”

Included in that is a focus on areas such as live video and virtual reality but also evolution in the ways we communicate.

Zuckerberg said earlier this month that artificial intelligence “chatbots” could be the future of online interaction.

He said the social media giant was building the ability into its Messenger app for third-party software to engage in lifelike text exchanges.

Separately, Facebook also announced it would create a new class of non-voting stock, known as “Class C capital stock,” designed to let Zuckerberg keep a tight control on the company as it issues more shares to compensate employees and investors.

Facebook said the move would allow for a one-time dividend payout if the proposal was accepted at Facebook’s AGM in June.

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