Facebook’s mobile march continues

The social network says 30% of its ad revenue came from mobile in Q1.

Zak Stambor

Facebook Inc. reported today that it generated $1.245 billion in advertising revenue in the first quarter, a 42.8% jump from $872 million during the same period in 2012 and a 6.3% dip from $1.329 billion in the fourth quarter of 2012.

Facebook says that 30% of that advertising revenue in the first quarter stemmed from mobile ad units, up from 23% in the fourth quarter. That means mobile ad revenue increased 22.2% from $305.7 million in the fourth quarter to $373.5 million in Q1.

That shift in mobile advertising comes as the social network seeks to remake itself into a mobile-first platform. Facebook last month launched Facebook Home, a robust Android app that changes the way a smartphone looks and operates to make Facebook the preeminent mobile activity on the device.

"We know that people spend an average of 20% or more of their time in apps on Facebook," Mark Zuckerberg, Facebook CEO, said today during a conference call with analysts. "Staying up to date with the people they care about and learning about what they are doing. We may open the Facebook app maybe 10 to 15 times per day. But we probably check our phones over a 100 times a day. So with Home, you can see fresh news and content from people and topics you care about every time you turn on your screen. It really brings your phone to life and provides with a completely new experience."

Facebook has also recently released several mobile-focused tools for developers, including a tool that lets mobile developers integrate its Open Graph into apps through new application programming interfaces, or APIs. The Open Graph is the sum total of the actions a user takes on Facebook.

The social network’s mobile push began in earnest when it launched its first mobile ad format, Sponsored Stories, in the first quarter of 2012. It then added multiple mobile ad units that appear in consumers’ news feeds, which display updates from friends and from companies that consumers are fans of.

Overall, Facebook reported $1.458 billion in revenue during the quarter, a 37.8% increase from $1.058 billion in the same quarter of 2012. The social network earned $219 million during the quarter, up 6.8% from $205 million a year earlier.

The social network generated average revenue of $1.35 per worldwide user in the first quarter, up 11.6% from $1.21 a year ago. In the United States and Canada the average revenue per user was $3.50 per user, up 20.7% from $2.90 a year ago. Facebook calculates average revenue per user as its total revenue during a given period, divided by the average of the number of monthly active users at the beginning as well as the end of the period; that is why the average revenue per user doesn’t equal revenue divided by its number of active users.

Facebook says that it had 1.11 billion active users as of March 31. It says it has 751 million monthly mobile active users, up 54% compared to a year earlier, and 665 million monthly desktop active users, a 26% increase year over year.

During the quarter Facebook launched several new advertising units, including Lookalike Audiences that enables direct marketers to target shoppers who are similar to their existing customers who shared information with the retailers off of Facebook, such as their e-mail addresses. It also enhanced its ad targeting tools to let advertisers target shoppers based on their offline behaviors.

Among the social network’s most successful ad units are its app install ads that aim to drive mobile consumers to immediately download an app, said Sheryl Sandberg, Facebook’s chief operating officer, today during the conference call. During the quarter, 3,800 marketers used the ads to drive nearly 25 million downloads, she said.



Canada, e-commerce earnings, Facebook, Facebook Home, Lookalike Audiences, m-commerce, mobile ads, mobile commerce, Open Graph, Q1 earnings, Sheryl Sandberg, social media, Sponsored Stories, web advertising