SAN FRANCISCO (AFP) - Facebook on Wednesday (May 3) reported its quarterly profit jumped just over US$3 billion (S$4.2 billion) as its ranks of monthly users closed in on two billion.
The leading social network said it made a profit of US$3.06 billion on US$8.03 billion in revenue in the first three months of this year, posting increases of 76 per cent and 49 per cent, respectively, compared to the same period last year.
Meanwhile, the number of people using Facebook monthly increased 17 per cent to 1.94 billion, according to the earnings report.
“We had a good start to 2017,” Facebook co-founder and chief Mark Zuckerberg said in the release.
“We’re continuing to build tools to support a strong global community.”
Facebook bested high expectations for revenue but fell short on profit, Shares fell 1.9 per cent US$148.93 in after-market trades that followed release of the earnings figures.
The California-based company’s shares had ended the trading day down less than a percent ahead of the earnings release and as it put out word of plans to hire an extra 3,000 staff to remove violent content like the gruesome killings and suicides broadcast on its video platform.
The move ramps up efforts by Facebook to filter content amid growing criticism of the social media giant for allowing the platform to be used to promote violence and hateful activity.
Increased hiring also promises to push up operating costs and eat into profit at the social network.
The world’s biggest social network and a powerhouse in online advertising, Facebook has been working to diversify its revenue base as it expands into new areas such as messaging, artificial intelligence and virtual reality. But advertising still accounted for the vast majority of revenues, US$7.86 billion.
Facebook’s family includes the fast-growing social network Instagram, the messaging applications WhatsApp and Messenger and Oculus, which makes virtual reality gear.
“At first glance, Facebook reported strong results, reflecting ongoing market share gains, the benefits of increasing monetisation of Instagram, and increasing video ad contributions,” Baird senior research analyst Colin Sebastian said in a note to investors.
“Given that Facebook growth remains healthy and robust, we believe any lingering concerns over user engagement and social competitors should dissipate.”
According to research firm eMarketer, Facebook this year will generate US$36.29 billion in digital ad revenue, up 35 per cent over last year. That gives Facebook a 16.2 per cent share of the worldwide digital ad market, behind Google’s 33 per cent.
That figure excludes the estimated US$3.92 billion in revenue expected this year from Instagram.