By Barbara Ortutay, Technology Writer
SAN FRANCISCO (AP) --Facebook’s stock is flying high after the world’s biggest social network posted higher revenue from mobile ads and delivered a healthy second-quarter profit that reversed a loss in the same period a year ago.
The results, which come on the heels of weaker-than-expected results from online search leader Google Inc., signal that Facebook’s aggressive push into the mobile advertising market continues to pay off. The company began showing mobile advertisements for the first time last spring. On Wednesday, Facebook said mobile ads accounted for a whopping 41 percent of its total advertising revenue.
The Menlo Park, Calif.-based company’s stock jumped $4.48, or 17 percent, to $30.99 in extended trading. The shares had closed the regular trading session at $26.51. Facebook’s stock priced at $38 when the company went public in May 2012, but hasn’t hit that level since.
“I’m completely surprised,” said Gartner analyst Brian Blau, summing up the sentiments of many investors who’ve watched Facebook’s stock price stagnate over the past year due in large part to concerns about its mobile prospects.
“I was actually thinking that maybe they would have a soft quarter,” he added, citing a softening of display advertising revenue — Facebook’s bread and butter — across the industry. “That seems not to be the case.”
Facebook Inc. earned $333 million, or 13 cents per share, in the April-June period. That’s up from a loss of $157 million, or 8 cents per share, in the same period a year ago. Adjusted earnings were $488 million, or 19 cents per share in the latest quarter, above the 14 cents that analysts were expecting.
Facebook’s revenue grew 53 percent to $1.81 billion from $1.18 billion, well above the $1.62 million that analysts polled by FactSet were expecting. The company has also quickened the pace of its revenue growth. In the first quarter, revenue grew 38 percent and in the fourth quarter of last year, 40 percent.
Jefferies analyst Brian Pitz called the quarter’s results “impressive” and noted that Facebook saw its highest revenue growth since the fourth quarter of 2011, when it was still a private company.
Mobile ad revenue was $655.6 million, or 41 percent of the quarter’s total advertising revenue of $1.6 billion. In the first quarter, mobile accounted for 30 percent of total ad revenue.
“We’ve made good progress growing our community, deepening engagement and delivering strong financial results, especially on mobile,” said CEO Mark Zuckerberg, in a statement. “The work we’ve done to make mobile the best Facebook experience is showing good results and provides us with a solid foundation for the future.”
Research firm eMarketer expects Facebook to increase its mobile advertising revenue more than fourfold to over $2 billion this year. This would give the company a 13 percent share of the global mobile ad market, up from about 5 percent last year.
That said, Google is a distant No. 1 when it comes to mobile ads. EMarketer estimates that the company held a 52 percent share of the global $8.8 billion mobile ad market last year. This year, the firm expects Google’s share to grow to 56 percent.
In a conference call with analysts, Zuckerberg sought to ease concerns that teenagers are growing tired of Facebook and flocking to newer, hipper services such as (Facebook-owned) Instagram.
“Based on our data, that isn’t true,” he said. “It’s difficult to measure this perfectly since some young people lie about their age, but based on the best data we have, we believe we have close to fully penetrated in the U.S. teen demographic for a while, and the number of teens using Facebook on a daily and monthly basis has been steady over the past year and a half.”
Facebook has also been working to increase its international advertising revenue, since most of its users live outside of the United States. The company announced this week that more than 100 million people access Facebook using traditional, non-smart phones in countries like India, Indonesia and the Philippines.
More than 53 percent, or $965 million, of the quarter’s revenue came from outside the U.S. and Canada.
Facebook had 1.15 billion monthly active users as of June 30, up 21 percent from a year ago. The number of monthly mobile users grew 51 percent to 819 million.
Brand New School Extends Reach Internationally Via Partnership With Animation Studio BRUT
Brand New School (BNS) has entered into a strategic partnership with BRUT, a Barcelona-based animation studio. This collaboration represents a significant milestone in BNSโs expansion strategy, with BRUT serving as its inaugural global outpost.
Under the leadership of executive creative director Martin Allais, who will now be represented by BNS for directorial ventures, BRUT joins BNS as part of its collective roster. This partnership combines BNSโs established reputation for innovative creative work with BRUTโs expertise in diverse artistic techniques, including 2D cel animation, stop-motion, 3D animation, and seamless integration of live action.
With Allais leading BNS Spain, Brand New School is expanding its reach to serve a growing network of global clients. This partnership incorporates BRUTโs fresh methodology of working and diverse pool of talent to create content that resonates across cultures. Located in the heart of the European market, the new BNS location will further support and enhance its work with international clients, broadening its ability to meet their unique needs. This partnership represents a thoughtful blend of creativity and expertise, designed to strengthen and grow Brand New Schoolโs global presence.
BRUT was founded by director Allais as an experimental incubator for innovative ideas and techniques. He is also a multidisciplinary artist of Latinx heritage who brings a wealth of creative experience to the partnership. His portfolio spans commercials for global brands like Oreo, Facebook, Samsung, and Dr. Pepper, earning accolades including Cannes Lions for his work on the Samsung Holiday campaign. Recently, Allaisโ animated VR experience capturing New York Cityโs punk scene in the โ70s, narrated by... Read More