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The company based in Menlo Park, California, USA, registered, between October and December 2020, revenues of $ 28,072 million. Despite the results, which beat analysts’ estimates, its shares fell 3.51% over the close of business on Wall Street.
“We had a strong end to the year as individuals and businesses continued to use our services during these difficult times,” said Mark Zuckerberg, CEO and founder of the company.
The $ 28,072 million of revenue represents 33% growth compared to the same period in 2019. The company generated a net profit of $ 11,219 million and earnings per share were $ 3.88.
During 2020, Facebook had a turnover of 85,965 million dollars, 22% more than that reached in 2019. In addition, it generated profits of 29,146 million dollars, which represents an increase of 58% over the previous year.
The income was higher than the estimates of the analysts, who expected an entry of 26,410 million dollars and an earnings per share of 3.54 dollars for the period.
The diversification of its products consolidates the success of Facebook
Facebook’s 2020 results were driven by an increase in ad spend on Facebook’s social media by companies seeking to capitalize on their sales, primarily in the holiday season.
The company’s foray into e-commerce was also important, with products such as Instagram Shopping and Facebook Marketplace. In recent years the company has made a commitment to sales through social networks, a service that was promoted in 2020 amid the restrictions imposed by the pandemic.
Recently, the company has launched a series of new products that allow purchases both on Facebook, the social network with the largest deployment worldwide, as well as in the entire set of applications of the homonymous company, of which the popular Instagram and WhatsApp.
“I am excited about our product roadmap for 2021 as we create new and meaningful ways to create economic opportunity, build community and help people have fun,” Zuckerberg said in a statement posted on his Facebook account.
Zuckerberg’s comments are derived from a constant increase in Facebook users, which in 2020 reached 2,800 million, 12% more than the same period in 2019. The company has a total of 3,300 million users if you count those of all the social networks that compose it.
Advertising regulations put Facebook’s business model to the test
Despite optimism, Facebook is moving cautiously into 2021 due to a number of factors that could work against business revenue. Among them, regulations, the change in Apple’s operating system and uncertainty regarding the future of advertising.
Regarding the latter in particular, Facebook explained that it benefited a lot from the switch to online commerce as a result of the pandemic. “Looking ahead, a moderation or reversal in one or both of these trends could be an obstacle to the growth of our advertising revenue,” the company says.
Another factor that could affect the income of the technology giant will be the change in the operating system for its mobile devices that Apple will experience. “While the timing of the iOS 14 changes remains uncertain, we would expect to see an impact from the end of the first quarter,” the company said.
The dispute centers on the fact that modifications to the latest version of Apple’s iOS operating software include a transparency function to track user tastes and interests that, according to Facebook, will limit their ability to serve targeted ads on their platforms.
In addition, Facebook has come under the scrutiny of antitrust regulators after the United States Federal Trade Commission (FTC) and 46 US states plus the District of Columbia and the territory of Guam, filed lawsuits in their against the end of 2020.
On the other hand, many question the way in which the company handles the content published by its users on its different social networks
With Reuters and AFP
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source https://pledgetimes.com/facebook-is-optimistic-after-increasing-its-revenue-by-33-at-the-end-of-2020/
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