Facebook shares open at record high after huge profit jump
Profit at social networking company tops $1.5B for year
Facebook shares opened at the highest level they've ever been on Thursday, a day after the social media company posted impressive earnings numbers.
Facebook stock was changing hands at $60.92 US on Friday, up 13 per cent from Wednesday's closing level. Before markets opened, institutional investors had pushed the shares up even higher in premarket trading. By the end of the day Thursday, Facebook shares were at $61.05.
After markets closed on Wednesday, Facebook said its revenue increased 63 per cent in the fourth quarter, as advertising on its mobile services continued to accelerate.
The world's No. 1 social networking company said revenue in the last three months of the year totalled $2.59 billion US, beating the average analyst expectation of $2.33 billion. That’s up 63 per cent on $1.6 billion in the last quarter of 2012.
Net income for the quarter was $523 million, up from $64 million the previous year.
"It was a great end to the year for Facebook," said Mark Zuckerberg, Facebook founder and CEO. "We're looking forward to our next decade and to helping connect the rest of the world."
The company's net income for 2013 was $1.5 billion on revenue of $7.87 billion, an increase of 55 per cent year-over-year.
Facebook says it had 1.23 billion monthly active users as of Dec. 31, 2013, an increase of 16 per cent from the previous year. Users on mobile totalled 945 million, an increase of 39 per cent.
Mobile ad revenue represented more than half of ad revenue in the fourth quarter of 2013, a reflection of how far the social media platform has come in developing mobile services.
That contrasts sharply with Yahoo, which reported falling display ad revenue yesterday. Despite a profitable year, Yahoo shares were down 8.4 per cent in trading today, as investors blamed CEO Marissa Mayer for failing to harness the power of internet advertising.
Facebook has found success by dropping its ad rates for mobile and display ads but selling more placements.
With files from Reuters