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Digital

Facebook Reports Third Quarter 2016 Results

Facebook has reported the financial results for the quarter ended September 30, 2016. 

Please find below an overview of the stats and highlights shared in Facebook’s Q3 earnings.

Third Quarter 2016 Financial Highlights*

 The information in the Third Quarter 2016 Financial Highlights table is presented in accordance with generally accepted accounting principles in the United States (GAAP). For non-GAAP financial information, see the table below titled “Reconciliation of GAAP to Non-GAAP Results.”

Third Quarter 2016 Operational Highlights 

•Daily active users (DAUs) – DAUs were 1.18 billion on average for September 2016, an increase of 17% year-over-year. 

•Mobile DAUs – Mobile DAUs were 1.09 billion on average for September 2016, an increase of 22% yearover-year. 

•Monthly active users (MAUs) – MAUs were 1.79 billion as of September 30, 2016, an increase of 16% year-over-year. 

•Mobile MAUs – Mobile MAUs were 1.66 billion as of September 30, 2016, an increase of 20% year-overyear. 

Third Quarter 2016 Other Financial Highlights 

•Mobile advertising revenue – Mobile advertising revenue represented approximately 84% of advertising revenue for the third quarter of 2016, up from approximately 78% of advertising revenue in the third quarter of 2015. 

•Capital expenditures – Capital expenditures for the third quarter of 2016 were $1.10 billion. 

•Cash and cash equivalents and marketable securities – Cash and cash equivalents and marketable securities were $26.14 billion at the end of the third quarter of 2016.

Here is what few of the Key people had say:

Sheryl Sandberg, COO, Facebook 

•Small Business – On local we think this is a really big opportunity and you see this in the large base of existing businesses using Facebook and Instagram increasingly. There’s 60 million small business pages on Facebook and 1.5 million Instagram Business Profiles which are the equivalent for Instagram. And the reason we think people are so active is it’s just really expensive and hard to have your own mobile site or your own even web page. 35% of small businesses in the United States, which is the most developed market, in many cases don’t even have a web page of any kind. And it’s cheaper and easier to build a web page than it is to build a mobile app and get distribution or downloads. So what’s happening is that people are really using the Facebook business pages and increasingly the Instagram Business Profile as their mobile presence. And we think that’s what’s working. And then we’re working hard to build products that work in store visits and then use simplified ad products that convert them over to advertising.

Mark Zuckerberg, CEO, Facebook

•Video – Video is naturally becoming a larger share of the content in news feed because both people and pages are sharing more videos in the mix and people want to consume that content. So there’s not really a question of whether that should be a separate app. This is what people want news feed to be increasingly so this is what it will become. There is a second experience called video home which we start talking about earlier in the year and we rolled out again in a few markets and those tests have gone well so we’re also hoping to roll that out pretty soon widely. And that’s the new experience which if you come to Facebook and you specifically want to watch some different kinds of videos or you want to see what videos a recent page that you follow has posted or presidential debate is on and you want to find a good place to go online and you can go to video home and see that. 

David Wehner, CFO, Facebook

•MAU Growth – On the MAU front, we’re seeing very strong overall growth in terms of the 240 million plus MAUs that we added. There’s really no single driver, but I’ll point to a few that contributed. It also plays into the fact that we’re seeing good growth in places like India, Mexico, Brazil, and others. First, we’re improving our Android experiences and we’ve talked about the impact that Facebook Light has had on that, just making easier registration processes, just making Android — our lightweight Android app easier to use. Secondly, Mark talked about the Internet.org efforts that we have. That’s been a contributing factor to MAU growth. And then finally we’re seeing the introduction of low price data plans in markets like India and Mexico contributing. So there’s no single factor but those are all contributing factors in terms of MAU growth. 

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