Facebook’s stock jumped more than 14 percent to $107.95 after the company reported a blockbuster quarter on Wednesday, pushing the company’s market capitalization over $300 billion.
Advertisement
Chief executive Mark Zuckerberg said that 2015 was a “great year for Facebook”.
The site has expanded rapidly in recent years – no longer just a social network, Facebook has since moved in to virtual reality with the purchase of Oculus, makers of the Rift VR headset, and the affiliate Internet.org company, which is using high-flying drones to bring internet connectivity to remote corners of the world.
The results showed Facebook’s growing power in online advertising, especially on mobile devices.
Facebook’s strong fourth quarter sent the social network’s shares soaring during after-hours trading on Wednesday.
Analysts on average had expected revenue of $5.37 billion so it seems that Mark Zuckerburg is laughing all the way to the bank. Facebook’s daily active users on mobile now total to 934 million, on average, an increase of 25 percent. By the end of the year, SunTrust analysts expect FB to sell 3 million units for $1.8 billion. That statistic far surpasses Snapchat’s 100 million mobile users, mostly confined to the U.S. Meanwhile, Facebook is building out internationally. Considering that sales, earnings, users, and engagement are all moving in the right direction, it’s no wonder Facebook’s status update is getting so many likes from investors.
The company also reported that it’s making more money than ever from mobile advertising, which now accounts for 80 percent of its revenue. This translates to a strong and lasting position on the platform for many years to come.
Although Facebook shares were down 3% during regular trading, closing at $94.45, the company’s earnings results, announced after the close of trading, buoyed its stock price after hours. However, at a comparable stage, Facebook’s revenue is increasing at a more rapid pace than that of Google.
Because 2015 was such a stellar year for Facebook, CFO David Wehner warned that it would be hard to match the success in 2016.
The jump in shares was set to add almost $33 billion to Facebook’s market value, putting the company on track to re-enter the $300 billion club. That is to say, they never touch the desktop version of Facebook.
The company pulled in $5.4 billion in revenue during the quarter that spanned September to December.
Advertisement
Compared to last year’s Q4 results, Facebook’s revenue grew an impressive 52 percent over the same time period last year, surging from $3.85 billion Dollars, to $5.84 billion USD.
