Beating the forecasts, world's largest social networking group Facebook registered a 32 percent revenue rise in the quarter that ended on Sept. 30 basically from its entry into mobile advertising in recent months.
Giving investors a break out of revenues generated from its mobile business for the first time, Facebook said it accounted for 14 percent ($150m) of advertising revenue in the last quarter. However, Facebook recorded another quarterly loss as it recorded a net loss of $59 million or 2 cents a share in the third quarter, compared with net income of $227 million a year ago. Excluding share-based compensation and income tax adjustments, the social networking giant could earn 12 cents a share.
Highlighting its future potential, Menlo Park, California headquartered company said it has crossed the 1 billion threshold for monthly active users, of which 604 million are mobile users, compared with about 47 percent a year earlier. The company said it would earn $8 billion from mobile advertising, apps and content in the coming year.
The company could successfully rebut the investor concern over the mobile advertising which caused a $40 billion dip in Facebook's market value since its May IPO. Revenue from mobile advertising totalled roughly $150 million, up from an estimated $40 million to $50 million. Ad prices increased 7 percent, while the number of ads delivered increased 27 percent.
"I want to dispel this myth that Facebook can't make money on mobile," said Mark Zuckerberg, Facebook founder and CEO. "This may have been true six months ago, because we hadn't started trying yet."
While the revenue from advertising increased 36 percent to $1.09 billion, an increase from 28 percent growth in the second quarter, revenue from its payments and other businesses increased just 13 percent to $176 million.
"Our goal is to help every person stay connected and every product they use be a great social experience," Zuckerberg said on a conference call with analysts on Tuesday. "That's why we're so focused on investing in our priorities of mobile, platform and social ads to help people have these experiences with their friends."
Facebook shares jumped nearly 13 percent to $21.97 in after-hours trading on Tuesday.
