Mobile ad spending leaps at Facebook

Q3 financial results show mobile marketing revenue now represents nearly 50 per cent of total advertising sales

Facebook has highlighted growth across its three target marketing segments – mobile engagement, number of marketers on Facebook and product development – in its latest third quarter financial report.

Leading its advertising efforts were new gains in monetising the mobile business, which drove nearly 50 per cent of advertising sales in the three months to 30 September, the company reported. Facebook's mobile advertising sales have risen from 23 per cent of total revenue in 2012's fourth quarter, to 41 per cent last quarter and now 49 per cent.

Total advertising revenue for the quarter reached US$1.8 billion, up 66 per cent year-on-year, against a total revenue of $2.02bn, according to the earnings announcement. This was up 60 per cent compared to $1.26 billion during the same period last year. The sales figures topped expectations of $1.91 billion, based on projections of analysts as polled by Thomson Reuters.

Profits were strong, too. Net income for the quarter was $425 million on earnings per share of $0.17, compared to a net loss of $59m and a loss per share of $0.02 during the year-ago period.

Mobile is a critical area of Facebook's business as more Internet users migrate away from the desktop in favour of devices like smartphones and tablets. Driving advertising on mobile can be challenging for Internet companies, but Facebook has been making inroads. The mobile gains reported Wednesday show a continuation of steady mobile advertising growth since late last year.

The company stands to grow its mobile advertising sales further, given the launch of products like ads on Instagram, the popular photo sharing app owned by Facebook. In an earnings call, Facebook COO, Sheryl Sandberg, pointed out Facebook including Instagram now gets one in five minutes spent on mobile, against one in eight minutes being spent by users on desktops.

Earlier this year, Facebook said building mobile products would be a focus for 2013. Examples include the launch of mobile app ads for engagement, along with enhanced measurement capabilities for the telco industry through the Outcome Measurement product.

Other advertising product development highlighted by Sandberg during the earnings call include improving ad targeting through new products such as Customer Audiences and Partner Categories, along with the overhaul of its ad create tool.

Sandberg said Facebook is also working on tools to help prove Facebook’s higher value in a multi-touch attribution marketing model. According to a recent study from Facebook PMD, Kenshoo, Facebook is undervalued by up to 30 per cent in a last-click attribution model.

To illustrate the rise in marketers using Facebook, Sandberg also said the number of Facebook advertisers in EMEA nearly equalled the number in North America for the first time in Q3.

"The strong results we achieved this quarter show that we're prepared for the next phase of our company, as we work to bring the next 5 billion people online and into the knowledge economy," Facebook CEO, Mark Zuckerberg, said in a statement, referring to the company's Internet.org campaign.

Facebook also grew its monthly active users during the quarter to 1.19 billion, an increase of 18 per cent compared to last year. On a monthly basis, many of the company's users -- 874 million -- are also active on mobile, it claimed.

Follow CMO on Twitter: @CMOAustralia, take part in the CMO Australia conversation on LinkedIn: CMO Australia, or join us on Facebook: https://www.facebook.com/CMOAustralia

Signup to CMO’s new email newsletter to receive your weekly dose of targeted content for the modern marketing chief.

Join the newsletter!

Error: Please check your email address.
Show Comments

Blog Posts

To DMP or not to DMP?

There are plenty of brands that can benefit from plugging into a data management platform. But should you engage an agency to run one or bring it in-house?

Ben Willee and Richard Taylor

Spinach Advertising

Innovations in retail will bring creative and technology closer than ever

While approaching a customer in a shop and asking what you can help them with is Retail 101, how many of us actually enjoy being approached? Generally, you have to give the forced, fake smile and say, “Just browsing, thanks,” while screaming on the inside, “just leave me alone!” Maybe it’s just me?

Jason Dooris

CEO and founder, Atomic 212

There’s a brand in my digital soup

Not a day passes by in the life of business executives where digital innovation or the prospect of disruption is not front of mind. This in turn, drives an unrelenting flow of questioning, discussion and strategy papers.

Jean-Luc Ambrosi

Author, marketer

Marin Software’s digital marketing solution as a short way of streamlining and finding a scalable solution...

Al Drazhev

How BizCover is boosting search advertising success

Read more

It is really inspiring to see that medial psychology & machines are going hand in hand to innovate new things and even are improving ...

CBT Professionals

How psychology is shaping better machine learning

Read more

Anything is achievable when you talk the talk .. good luck

Mo Al Hooti

Data Creative crowns Matt Bates as new CMO

Read more

Great hire and good luck Andrew. I am sure you'll do a fabulous jobRob

Rob

Amaysim marketing and commercial chief joins property tech investment startup

Read more

I need to be reborn before i can grow up & become a contestent.

Kaye Peterkin

Channel Nine's content now streamed digitally on 9Now

Read more

Latest Podcast

More podcasts

Sign in