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What slower growth? Facebook soars on strong mobile and video ads

03 February 2017

Facebook's quarterly profit hit $3.57 billion, up 128 percent from the $1.56 billion it posted a year earlier.

Mobile ad revenue accounted for 84 per cent of the company's total advertising revenue of US$8.63 billion in the fourth quarter that ended December 31, compared with 80 per cent a year earlier.

"We're experimenting with Live 360 video, audio-only live for people with slower connections, and live face masks and more camera effects, and we'll have more updates soon", said Zuckerberg in an earnings call transcribed by Seeking Alpha.

"With only a small fraction of the businesses on Facebook and Instagram advertising, we know we have a lot of opportunity and hard work ahead".

Facebook is expected to generate about $29.71 billion in mobile ad revenue in 2017, according to research firm eMarketer, up about 35.2 percent from 2016. Monthly active users on its main social network reached 1.86 billion people, 1.23 billion of them checking daily and 1.74 billion accessing it via their smartphones, Facebook said Wednesday in a statement.

Mobile DAUs - Mobile DAUs were 1.15 billion on average for December 2016, an increase of 23% year-over-year.

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The analyst also believes the pace of the company's advertising changes is accelerating, as runs Dynamic ads, and tests ads for Instagram Stories and Messenger, in addition to the Facebook video tab and focus on live video. Last week, Google parent Alphabet Inc. reported better-than-expected fourth-quarter sales, and while a profit shortfall disappointed investors initially, analysts said Google's own mobile and video ad growth is accelerating.

Total revenue rose to $8.81 billion from $5.84 billion a year ago.

A sign at the entrance to the Facebook World Headquarters located in Menlo Park, California on March 18, 2014. The Facebook Platform is a set of tools and application programming interfaces that developers can use to build social apps on Facebook or to integrate their Websites with Facebook.

Meanwhile, the company's monthly active usersbase moved up to 1.86 billion.

Facebook's ratio of monthly to daily active users - an important statistic used to judge user engagement with the service - stayed steady at 66% for the fourth consecutive quarter. In the US Facebook has introduced a tab at the bottom of the Facebook app with top videos and recommendations and plans to roll out the function in other countries.