"Facebook will announce its second quarter earnings today, and the social giant appears to have solved its mobile problems. When Facebook launched its IPO two years ago, it was criticized for not having a clear mobile strategy. Just two years later, more than half of the firm's revenue comes from mobile ad sales and its stock is approaching an all-time high. Now that is has figured out mobile, it is moving on to an even more lucrative segment: commerce."
"The challenge for Facebook has always been how best to unlock the value from those users. It doesn't hurt that Facebook has some of the most advanced ad-targeting technology in the world, but that wouldn't matter much without a solid mobile solution. Mobile ads are the fastest growing segment of the digital ad market, and Facebook has been desperately focused on getting those dollars."
Facebook has solved its mobile problems and converted mobile reach into substantial revenue. More than 1.3 billion active users provide broad scale and more than half of revenue now comes from mobile ad sales. Mobile revenue comprised 59 percent of Q1 earnings. Facebook acquired Instagram and WhatsApp to retain and expand its user base, paying $1 billion for Instagram and $16 billion for WhatsApp. WhatsApp retains a $1/year service and lacks a clear monetization plan, creating pressure to find revenue sources beyond ads. Facebook is testing Buy buttons in the News Feed to enable social shopping and diversify beyond advertising.
Read at PCMAG
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