Facebook’s mobile ad revenue grew by 76% to $4.26 billion in Q1 2016

Tim Peterson on
  • Categories: Channel: CMO Zone, Facebook, Facebook: Advertising, Facebook: Business Issues
  • Facebook’s quarterly earnings reports are almost obnoxious at this point. Imagine if every few months an already rich friend of yours announced they’ve become even richer. That’s Facebook.

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    Through the first three months of 2016, Facebook made $5.38 billion and banked $1.51 billion in net income. That overall quarterly revenue figure is 52 percent more money than the social network made in the first quarter of 2015.

    Almost all of that money — 97 percent — comes from advertising, and that part of Facebook’s business is growing at an even steeper rate. In the first quarter of 2016, Facebook’s advertising revenue ballooned by 57 percent year over year to hit $5.20 billion. And its mobile ad revenue rocketed at an even steeper clip, increasing by 76 percent year over year to hit $4.26 billion and account for 82 percent of the period’s ad revenue. For what it’s worth, Twitter generates a higher share of its ad revenue from mobile — 88 percent — but Twitter only rakes in about a tenth of the total ad revenue that Facebook generates.

    But it’s not only the amount of money Facebook made that’s obnoxious; it’s how Facebook made that money. Not only did Facebook get even more people to use Facebook than were already using it, but it was able to make more money for each person who uses it.

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    In the first quarter of 2016, 1.65 billion people, on average, used Facebook every month — a 15-percent increase year over year — and 1.09 billion people did so every day — a 16-percent increase year over year. On top of that, the average amount of money Facebook made for each person who used Facebook increased by 33 percent to $3.32. And the average amount of money Facebook made from showing ads to each person hit $3.21, a 37-percent rise year over year.

    Another way to look at Facebook’s ad business is how many ads it runs and how much it’s able to charge per ad. Like seemingly everything else in Facebook’s Q1 earnings report, both of those stats have grown. Facebook served up 50 percent more ad impressions than it did a year ago and got advertisers to pay five percent more money on average for each ad, Facebook CFO David Wehner said during the company’s earnings call on Wednesday.

    About The Author

    Tim Peterson
    Tim Peterson, Third Door Media's Social Media Reporter, has been covering the digital marketing industry since 2011. He has reported for Advertising Age, Adweek and Direct Marketing News. A born-and-raised Angeleno who graduated from New York University, he currently lives in Los Angeles. He has broken stories on Snapchat's ad plans, Hulu founding CEO Jason Kilar's attempt to take on YouTube and the assemblage of Amazon's ad-tech stack; analyzed YouTube's programming strategy, Facebook's ad-tech ambitions and ad blocking's rise; and documented digital video's biggest annual event VidCon, BuzzFeed's branded video production process and Snapchat Discover's ad load six months after launch. He has also developed tools to monitor brands' early adoption of live-streaming apps, compare Yahoo's and Google's search designs and examine the NFL's YouTube and Facebook video strategies.