Facebook posted a 76% growth in advertising revenue in the final quarter of 2013, a number that surprised Wall Street experts, according to multiple news sources.
The increase, according to Forbes, is primarily the result of better advertising pricing. The Facebook mobile platform is also gaining in popularity, with record revenue growth in the fourth quarter.
The October through December period of 2013 was the first ever in which mobile ad sales accounted for more than half of all sales – 53% – but also brought in more than $1 billion. To put that in context, the mobile ad revenue numbers were 309% higher than in December 2012.
Why should business administration students pay attention to Facebook? Because the company is on the cutting edge of Web advertising and content marketing. The California-based Facebook is also willing to experiment with everything from the look of the site to the placement of advertisements, making it worthy of following for information on content marketing and media sales.
In a press release, Facebook founder and CEO Mark Zuckerberg said, “It was a great end of the year for Facebook. We’re looking forward to our next decade and to helping connect the rest of the world.”
According to Forbes, the actual impressions on Facebook ads declined by 8%, but prices have increased to the point that they made up for the decline in the number of people looking at the ads.
Facebook, trying to improve revenue even further, is working on developing features and tools that will allow the company to better track where users go, which in turn will improve how and where advertisements are placed, according to Forbes.
Forbes projects that Facebook will continue to grow but that the growth will be somewhat flat in 2014.
For the whole of 2013, Facebook reported revenue of $7.87 billion. That’s a 55% increase over the numbers from 2012, when the company made $5.089 billion. Net income for the year was $1.5 billion.
For the fourth quarter, Facebook’s revenue was $2.59 billion, according to numbers from the company.
Facebook reported the numbers after the close of the stock market on Wednesday. By Thursday morning, the stock had jumped in value by about 16%.
According to Slate, the big jump in revenue came not from attracting new users to Facebook, but better monetization of the users already in place. By simply placing ads within the users’ news feed rather than in the right rail, the click-through rate increased 4.5 times what it was in 2012. According to Slate, advertising revenue per user is up 25%.
