Last week Facebook released earnings. Still the behemoth of social networking, perplexingly it gets little respect from analysts. One of the biggest criticisms of Facebook over the past year was the risk it could be usurped because of its weakness in mobile. Case closed. Facebook is the world’s biggest mobile business. The stock gains over the past week now reflect the elimination of that risk.
$656 million in quarterly mobile revenue
It was important that mobile was identified as a potential threat to the company during the pre-IPO investor road show. The company saw the risk, made a mistake throwing its weight behind an HTML 5 experience, reversed course to focus on native apps and users have clearly responded. The fact is that mobile has not displaced Facebook. It has increased usage. People are spending more time on Facebook because of mobile and those users are valued by advertisers to a total of $656 million in revenue – 41% of Facebook’s total.
But wait there’s more – Instagram
If it weren’t enough to have 819 million monthly active users on Facebooks’s mobile app, the company’s key mobile acquisition, Instagram, now claims another 130 million monthly active users. What? Somewhere around 950 million people are using a Facebook owned mobile app each month. That sounds like a robust mobile company to me.
Are Younger Users Fleeing in Droves – no
The anecdotes of youth ignoring or leaving Facebook are common. Facebook CEO Mark Zuckerberg’s analysis suggests the data doesn’t back up this urban legend. MarketWatch quoted Zuckerberg as saying, “the number of teens using Facebook on both a daily and monthly basis has been steady over the past year and a half.”
Facebook: a bellwether for Consumer Mobile
People are constantly trying to understand the future of mobile. It is a broad topic and most of the companies with a big mobile presence are technology conglomerates (Google, Samsung, Apple) or narrow in their market presence (Millennial Media, Yelp). Facebook is less about the fashion of the device and more about pure mobile usage.
If you want to track the health of the consumer mobile sector for the time being look to Facebook’s quarterly numbers. Based on last week’s earning report, mobile looks healthy and is growing fast. Facebook is your new mobile bellwether.
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