Facebook shares surged nearly 12pc in
after-hours trading after the company finally revealed it has cracked how to
make money out of mobile users.
The company, which will celebrate its
10th anniversary this week, saw revenues surge 55pc to $7.87bn in 2013,
accelerating sharply towards the end of the year as more advertisers paid for
adverts on its mobile website.
Sales jumped 77pc to $2.6bn in the
fourth quarter, including more than $1bn from advertising on mobile phones.
Profits grew more than seven-fold to $523m in the fourth quarter, bringing
annual profits to $1.5bn.
The performance marks a dramatic
reversal of fortunes for Facebook, which floated in May 2012 and spent its
first year as a public company struggling to work out the best way to monetise
mobile users effectively.
The social network plummeted in value in
the weeks following its flotation and only recovered its $38 IPO price late
last year.
However, on Wednesday, shares soared to
close to $60, as the results reassured investors that the company will continue
growing.
Sheryl Sandberg, chief operating
officer, added: “It is our first billion dollar mobile quarter. In fact, our Q4
ad revenue from mobile was nearly as large as our total ad revenue in Q4 last
year.”
Mobile ads accounted for 53pc of
advertising revenue, compared with 49pc the previous quarter.
The company received a particular boost
on Black Friday, the day after Thanksgiving in America and traditionally
biggest shopping day of the year. “When people shop, they’re on their phones,
and while their on they’re phones, they’re on Facebook,” Ms. Sandberg said.
The company also doubled the number of
users of Instagram, the photo-sharing website Facebook bought for $1bn in 2012.
However, Facebook warned that it would move slowly in introducing advertising
on the service.
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