Facebook mobile growth accelerates down open road

January 27, 2016

The author is a Reuters Breakingviews columnist. The opinions expressed are her own.

Facebook’s mobile growth is accelerating down an open road. The social-media giant said fourth-quarter revenue from advertisements on smartphones and tablets increased a whopping 81 percent over the prior year, accounting for most of the quarter’s $5.8 billion in top-line sales. With more firms getting comfortable touting their wares on digital devices, Mark Zuckerberg’s creation has plenty of room to rumble.

The company will be 12 years old next week, and it shows no signs of slowing down. Twitter and other peers, meanwhile, are still struggling to gain traction among advertisers.

Facebook’s fourth-quarter ad revenue jumped 57 percent year-over-year to $5.6 billion, outpacing the third quarter’s impressive growth rate of 45 percent. Even net income, mostly an afterthought in Silicon Valley, increased 123 percent from the same period in 2014, to $1.6 billion.

The tailwinds are picking up speed for Zuckerberg. Global spending on mobile advertising is expected to reach $137 billion in 2017, according to research firm eMarketer. Facebook is forecast to capture 17 percent of that share.

The company has left former darlings like Yahoo and established players like Microsoft far behind, and it is second only to powerhouse Google in attracting digital ads. The risk, of course, is that a competitor will at some point snatch Facebook’s mojo, much as it has stormed past fading competitors.

Messaging app Snapchat is a possible contender, though it has yet to attract strong attention from Madison Avenue. For now, at least, it’s tough to see anything getting in Facebook’s way.

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