When it comes to mobile, there’s no bigger story than Facebook.
Facebook beat Wall Street expectations yet again, reporting $7.01 billion in revenue during the third quarter, a 59% increase over the same period last year. Net income reached$2.37 billion, up 166% from a year earlier.
The big driver was mobile advertising, which surged 70% from a year earlier to $5.7 billion in revenue. Mobile made up 84% of Facebook’s total sales in the third quarter.
The social media network continues to add users at a healthy pace, reporting that 1.79 billion people logged onto the website at least once per month, up 16% year-over-year. Of those users, 1.18 billion check Facebook every day, and 1.09 billion of those people check it daily on their phone. This quarter was the first time daily active mobile-only users eclipsed the 1 billion mark.
The fact that Facebook is still adding mobile users bodes well as the company battles Snapchat to be the go-to destination for cataloging daily life and connecting with friends. Facebook has been reworking its algorithm to show more personal content rather than news articles and posts from brands, and has been less and less coy about attempts to copy Snapchat. Instagram, owned by Facebook, recently added Snapchat-like “Stories,” and Facebook is even testing self-destructing messages on the Messenger app in Australia. Facebook CEO Mark Zuckerberg said Instagram Stories already has 100 million daily users, the same number Snapchat reported in February.
Keeping up such torrid growth is nearly impossible and the company is attempting to pump the break on expectations a little bit. Facebook CFO David Wehner said on a call to discuss earnings that the company expects ad revenue growth rates to “come down meaningfully” in 2017. Shares are down more than 5% in after-hours trading.
One issue for Facebook is its ability to get more money out of its faster growing non-US user base.