Facebook ad revenue sees stellar climb

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Facebook’s sales soared 38 per cent in Q1 2013 thanks to its flourishing ad business for mobile devices, according to a CNN report.

Mobile advertisements contributed 30 per cent of the firm’s overall ad revenue in Q1 2013. This translates to a huge gain compared to Q3 2012’s ad earnings and from essentially nothing a year ago.

This is because Facebook started working on its mobile ad business only a few quarters ago, and the most notable move back then was the rollout of its new iOS application.

While the higher earnings from mobile ads bolstered its revenue, the growth in the social network’s monthly active users for both desktop and mobile users is falling. Comparatively, it soared by 54 per cent year-on-year to 751 million in Q1 2013 versus an annual increase of 61 per cent in Q3 2012.

The growth rate is also forecasted to become more sluggish as mobile users are coming into parity with the overall number of users. The company also reported that the total active users per month climbed to 1.11 billion, of which 751 million accessed the site via their smartphones and tablets.

However, shares of Facebook were basically flat during after-hours trading after the revenue report was released.

During the post-earnings conference call, Facebook’s Chief Executive Officer Mark Zuckerberg spent a fair amount of time discussing advertising and the firm’s plans to continuously incorporate ads without putting off users.

“Over the long term, the thing that’s going to drive the business is the ads that are very high quality … things people are interested in,” added Zuckerberg.