Facebook’s net profits for the third quarter (Q3) of 2016, ending on September 30, 2016, leapt 166% to $2.4 billion while the revenue rose to $7 billion, compared to $4.5 billion revenue earned during the same period a year earlier.
Although the popular social media site has topped Wall Street’s expectations, the shares dived down, more than 8% to $116.54, Facebook announced in its earnings release on November 2, 2016.
Facebook co-founder and chief executive, Mark Zuckerberg said in the earnings release, “We had another good quarter. We’re making progress putting video first across our apps and executing our 10 year technology roadmap”.
The research firm, eMarketer, has projected Facebook’s worldwide ad revenues for 2016 at $26 billion, up from $17.08 billion generated in 2015. The research firm estimates that Facebook will make an ad revenue of $33 billion in the upcoming year, 2017.
According to the earnings report, Facebook has 1.79 billion monthly users as of September 30, 2016, showing a surge of 16% when compared to 2015.
A significant increase in the number of people, who access Facebook from their mobile devices has been recorded as the monthly mobile users rose by 20% to 1.66 million.
The impressive, quarterly earnings performance by Facebook is mostly dependent upon the consistent growth in mobile ad revenues as it amounted to around 84% of the total ad money generated by the social site, up from 78% from a year earlier.
Apart from that, Instagram – a photo and video sharing application, has also started to drive ad revenue to the company, the earnings report said.
When it comes to online advertising, Facebook is leading the market as the social site is introducing new ad formats for mobile and is offering personalised and targeted marketing messages to its users.
Mr Zuckerberg is focused on expanding the services of the social network as he has laid out a clear, long-term vision for Facebook that includes artificial intelligence, virtual reality and providing Internet service to far-flung areas via self-flying drones.
Earlier this year, Facebook launched a new feature called ‘Facebook Live’ – the feature did not only turn out to be a success, but according to Zuckerberg, the number of users has quadrupled already.
The social site has recently released a new app, Lifestage iPhone app, which is similar to the likes of Snapchat. The application lets teens watch short clips about their classmates’ lives.
Currently, Facebook is also testing an online Home venue, which is exclusively designed as a place for video.
Zuckerberg commented in this regard, “People are creating and sharing more videos. It is pretty clear video is only going to become more important”.
Facebook, along with Google, is one of the internet giants that are actively working on artificial intelligence to get a better understanding about their users and thereof provide them with better solutions.
Not only that, the social site makes use of artificial intelligence to identify any hoax stories and to monitor terrorist propaganda in the Facebook news feed, Zuckerberg said.
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