San Francisco: Facebook shares bounced with word that profit more than doubled in the final quarter of last year, coming back down after a vow to spend heavily on the future.
In earnings that topped most forecasts, Facebook said it made a net profit of USD 3.7 billion on revenue of USD 8.6 billion in the fourth quarter, as compared with profit of USD 1.6 billion on USD 5.6 billion in revenue in the same period a year earlier.
Meanwhile, the number of people using the leading social network monthly increased 17 percent to 1.86 billion. The ranks of people accessing Facebook from mobile devices each month grew to 1.74 billion, an increase of 21 percent from the same period a year earlier.
Money taken in from ads on mobile devices accounted for about 84 percent of the social network's overall advertising revenue in the final quarter of last year. "We believe concerns over user engagement and other social competitors are likely overblown, as few companies share Facebook's combination of scale, strong technology orientation, and platform breath/diversity," Baird research analyst Colin Sebastian said in a note to investors.
Facebook saw strong growth in Asia, with India being a hot market in the quarter. The social network still hopes to get into China, where the service is not allowed. "Our mission is to connect everyone in the world and it's hard to do that over the long term if we don't find a way to serve the more than billion people who live in China," Zuckerberg said while answering questions from analysts on an earnings call.
"But one of the big things that we need to think about here is of course we're only going to do this in a he way that we're comfortable with over the long term." Facebook shares jumped more than two percent in after-market trades, returning to 15 cents above the closing price of USD 133.23 after chief financial officer David Wehner reminded analysts that the social network has essentially run out of spare room for ads and plans to invest 'aggressively.'
"Our business did well in 2016, but we have a lot of work ahead to help bring people together," said Facebook co-founder and chief executive Mark Zuckerberg. "Our mission to connect the world is more important now than ever."
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