Facebook's fourth-quarter financial report comprehensively exceeded expectations, net profit increased by 128% year-on-year

fourth-quarter Facebook revenue reached $8.81 billion, higher than analysts' expectations of $8.5 billion. Mobile advertising accounts for 84% of total revenue, up from 80% a year ago. Facebook's profit was about $1.56 billion in the fourth quarter of last year and $3.57 billion in the fourth quarter of 2016.

original title Facebook fourth quarter results: revenue exceeded expectations by advertising

February 2, Facebook announced fourth-quarter results, revenue rose 51% year-on-year, exceeding Wall Street expectations, mainly from mobile advertising.

CFRA analyst Scott Kessler (ScottKessler) said: "fourth-quarter results are strong. The overall revenue growth rate exceeded 50%, and the adjusted EPS figure was significantly higher than expected. From the indicators we have tracked, Facebook has fully exceeded expectations. "

strong > shows no sign of slowing down / strong >

Facebook announces that it will increase spending, recruit new engineers, expand data centers, invest in other projects, and reduce the number of ads displayed in "News Feed". At the earnings analyst meeting, Facebook Chief Financial Officer David Weiner (David Wehner) once again stressed the need to reduce the number of ads and increase spending.

JanDawson, chief analyst at Jackdaw Research, said: "so far, the number of ads shows no sign of decreasing, but they say it will decrease in 2017, so it looks like it will decrease in the future."

in fact, the year-on-year growth rate of Facebook revenue is slowing. Revenue rose 56% in the fourth quarter from a year earlier, and 59% in the second quarter. Because of this, Facebook needs to find new sources of revenue. Analysts are optimistic about the future of the company.

eMarketer analyst Debra AhoWilliamson said: "Last year, advertising revenue grew faster than we expected. We think it will grow by 52%, and as a result, it will increase by 57%. Facebook continues to break expectations, exceeding expectations quarter after quarter, and although revenue growth has declined in the past few quarters, we will not change our attitude. In the future, we think Facebook will get more revenue, such as more advertising revenue from Instagram, and more advertising revenue from Messenger and WhatsAPP. " EMarketer believes Instagram will generate $3.64 billion in advertising revenue in 2017, up 96 per cent from a year earlier. Messenger monetization is slower.

strong > Video strategy / strong >

for Facebook, video is the key to the future. Zuckerberg believes that in the next five years, most of the content that users consume on the Internet will be video, including text and pictures. He calls the next content wave "megatrend".

Facebook has begun to implement the "video first" strategy. Video advertising is lucrative, and Facebook can also compete for television advertising through video, which has a $70 billion television advertising market in the United States.

on Wednesday, Zuckerberg said on a conference call: "in all Facebook APP, we will put video first, making it easier for users to capture and share videos in new ways."

Facebook will devote more resources to developing original content. "We want users to see Facebook as an interesting place," Zuckerberg said. "it can provide videos made by professional creators as well as videos from friends."

strong > 2 billion users / strong >

Jane Dawson believes that the rate of user growth is the most surprising.

in December, 1.23 billion people used Facebook every day, up 18% from a year earlier. As of December 31, the number of monthly active users increased to 1.86 billion, up 17% from a year earlier. 2/3 monthly active users visit Facebook every day.

Dawson said: "the number of users is growing very fast year on year, although the base is huge, but the growth rate is still very fast." This year, Facebook users are likely to exceed 2 billion, and no company has yet done so. "

Let's take a look at the important data: the number of daily active users is 1.23 billion, almost all of them are mobile users, the number of mobile users is 1.15 billion; the number of monthly active users is 1.86 billion, mobile users are 1.74 billion.

strong > what did Zuckerberg say / strong >

at the earnings conference, Zuckerberg told investors: "like mobile, video is a megatrend." He said Facebook Live was already huge, adding: "We are looking for ways to expand the Facebook video ecosystem." He hopes Facebook will become a "more formal" community, that is, to stop the spread of fake news.

soon, Facebook will add "video call" to WhatsApp, but Zuckerberg didn't reveal any monetization plans.

Zuckerberg told analysts that more videos and ads will be added to "News Feed". Facebook shares advertising revenue with video producers in a model similar to YouTube. Did Facebook steal users from Instagram, or did Instagram steal users from Facebook? Zuckerberg doesn't think so. he says the two are complementary in the past and will continue to complement each other in the future.

Facebook COO Sandberg points out that the content produced by users is not very profitable, but the content produced by creators is very good.

strong > VR is temporarily unprofitable / strong >

now users like to watch videos on YouTube APP, and Zuckerberg hopes that users will change their attitude and watch them on Facebook in the future.

when it comes to the popularity of VR/AR, Zuckerberg believes that we should take a long-term view, because it will take 10 years to achieve. He compared the development of VR to smartphones, and Zuckerberg wants investors to be patient, because VR won't bring much profit to Facebook in the short term.

once Facebook had high expectations for Oculus. Since the launch of the consumer VR helmet last year, product sales have not been particularly good, revenue has declined, and Oculus has changed its supervisor.

Edit: nancy