Facebook Sales Exceed Estimates as Companies Experiment With Ads

Facebook reported overnight and some of you may be interested, so i am passing on this Bloomberg article. The most interesting thing to come out of reports is that they are aware of the importance of MOBILE! DER! and are working on their mobile platform. Well show us!!

FacebookInc. (FB), owner of the largest social network, posted sales that topped analysts’ estimates as companies experimented with new tools for delivering marketing messages to users of handheld electronics.

English: Mark Zuckerberg, Founder & CEO of Fac...

English: Mark Zuckerberg, Founder & CEO of Facebook, at the press conference about the e-G8 forum during the 37th G8 summit in Deauville, France. (Photo credit: Wikipedia)

Third-quarter sales rose 32 percent to $1.26 billion, Menlo Park, California-based Facebook said today in a statement. That compares with the average estimate of $1.23 billion, according to data compiled by Bloomberg. Profit excluding certain items also exceeded projections by a penny.

Chief Executive Officer Mark Zuckerberg is making headway in a drive to boost mobile-advertising revenue. He has stepped up investment in tools designed to help businesses attract the attention of people who are easily distracted while socializing on mobile devices. Facebook has introduced seven ad features created for smartphones and tablets since March, helping it garner 14 percent of advertising sales from the mobile arena.

“They are very much focused on monetization and mobile,” said Scott Kessler, an analyst at S&P Capital IQ, who has a buy rating on the stock and doesn’t own it.

Profit excluding certain costs was 12 cents a share in the third quarter. That compares with estimates of 11 cents a share. The company posted a net loss of $59 million, or 2 cents a share.

Shares of Facebook rose in late trading, after gaining less than 1 percent to $19.50 at the close in New York. The stock has fallen 49 percent since the initial public offering in May. The company, who held the largest Internet IPO on record, has lost more than $40 billion in market value, as investors fretted that the company won’t quickly ramp up revenue tied to mobile users.

Mobile Users

About 60 percent of the company’s more than 1 billion members are accessing the service on mobile, compared with about 47 percent a year earlier.

Still, in its first year in the running, Facebook is likely to rank only sixth in U.S. mobile advertising for 2012, with just 2.8 percent share of the market, according to EMarketer Inc. Google, which is No. 1, is estimated to hold 55 percent, up from 52 percent in 2011.

Earlier this year, Facebook rolled out Sponsored Stories as its inaugural mobile ad service, letting companies promote content that a user’s friends have signaled they “like” or interacted with in some way. The social network then added Promoted Posts, in which companies can highlight marketing messages to their fans and friends of fans.

Facebook Exchange

The company also has tried to improve the effectiveness of its ad tools that help better target users. It has rolled out the “Facebook Exchange,” letting companies tailor ads on Facebook based on their Web-browsing history outside of the service. The company also said it would roll out a service that lets advertisers use data they’ve collected from their own customers, such as e-mails and phone numbers, to target those users on Facebook, using a software tool that is designed to protect the members’ identities.

While the company is investing in its business, its shares could come under pressure in the coming weeks as more shares are freed up for potential trades.

Some shareholders “may choose to divest their stakes rather than take risks associated with holding the shares any longer,” Brian Wieser, an analyst at Pivotal Research Group LLC, wrote in a research note. “Such an influx would add meaningfully to stock-price risks if buyers are not present to absorb the shares.”

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