Facebook’s Q1 2013 results

Eden Zoller, Principal Analyst, Ovum comments.

“Mobile was once again the central focus, and success story, of Facebook’s Q1 2013 results. Mobile users and engagement continues to rise with mobile monthly active users reaching 751m in Q1, compared to 488m in Q1 2012. This compares to a total of 1.11bn MAUs. In this context Facebook’s ability to monetize mobile is more critical than ever and the results here were positive with mobile advertising accounting for 30 percent of total advertising revenues, compared to 23 percent in Q4 2012. Mobile app install ads proved a star turn in the quarter with 3,800 developers using the ads to drive close to in close to 25 million downloads. But keeping the momentum behind user engagement on mobile, and indeed on the desktop, will become more challenging for Facebook going forward as users have an increasing number of alternative social applications to lure them away from Facebook, notably in communications where apps like WhatsApp and others are making their mark. Facebook clearly had this in mind with the recent launch of Facebook Home, the app for Android devices that integrates Facebook services more closely with the device. . Facebook Home is too new to reflect in the Q1 results but Facebook expects great things from the app and promises a major marketing push behind it over the coming months. Cue all eyes on Facebook Home in Q2 results.

“Facebook’s continued investment in product innovation continues to take its toll on margins, which puts new initiatives under intense scrutiny and Facebook’s updates on this front were mixed if not muted in some quarters. On the plus side the revamped News Feed, App Install ads, Facebook Exchange and the Custom Audiences tool were all said to be making positive contributions to advertising revenues, with the average price per ad increasing a modest 3 percent. But Facebook was less reassuring on other key service developments and acquisitions. Graph Search was barely mentioned, despite being flagged at launch as a central pillar for future growth. Instagram is ramping up nicely in terms of the number of users (100m monthly active users in Q1 2013) but any concrete progress on monetizing the service remains vague”

The following two tabs change content below.

David Dungay

Editor - Comms Business Magazine
If you have any comments please click the link
Comments 0

Leave a Comment