Record Growth in Facebook Revenue Since 2016

Ethan James 30 Jul 2021

The net profit of the American tech giant Facebook doubled to $10.4 billion in the second quarter of 2021 compared to the same period last year. WSJ wrote about it. The company's revenue for the reporting period was $29 billion, which is a record for this quarterly figure over the past five years.

Facebook representatives emphasized that 98% of the income came from advertising. The company raised its ad price by 47% and also increased the number of ads by 6%, mostly on the Instagram and WhatsApp mobile apps. All financial indicators were higher than analysts had predicted.

The company noted that it expected a decrease in revenue in the third quarter due to possible issues in ad targeting. It referred to changes in the privacy settings of Apple's operating system. With the latest iPhone and iPad updates, users have the opportunity to block mobile apps from tracking data.

Despite the strong financial performance, the company's shares fell by more than 3%. As expected by Facebook, the reason for it was a slowdown in income growth in the second half of this year. One of the factors was the passage of a so-called active growth period. So, for example, in Canada and the United States (regions that bring the service higher income per user on average, when compared with other countries), the number of active clients didn’t change; that is, there were 195 million left. In Europe, the number of active users fell by 2 million altogether: from 309 to 307 million.

Facebook plans to develop better content and invest in virtual reality technologies in the next period. CEO Mark Zuckerberg noted that the company will now focus on building a digital "metaverse." The main goal will not be to sell devices but to make money by selling digital goods as part of a new "vision."