Facebook Reports 11 percent ad-growth amid Global Pandemic!

Marco Green
August 4, 2020

"We expect our full quarter year-over-year ad revenue growth rate for the third quarter of 2020 will be roughly similar to this July performance".

Even as economic growth sputters, Facebook's results show advertisers were willing to boost budgets in the second quarter after previously holding off. Facebook's profit was $5.18 billion, or $1.80 a share, beating the $1.39 per-share average estimate.

Facebook said that its daily active users increased 12 percent year-over-year to 1.79 billion on average for June 2020, while its monthly active users were 2.70 billion as of June 30, 2020, also up 12 percent year-on-year.

Its quarterly sales fell for the first time in its 16 years as a public company. "In many ways, in this hard time for people around the world, our services are more important now than ever".

Analysts have noted that while the ad boycott targeted larger image-conscience businesses, most of Facebook's ad revenues come from smaller companies seeking to micro-target potential customers.

Facebook CEO Mark Zuckerberg speaks via video conference during the House Judiciary Subcommittee on Antitrust, Commercial and Administrative Law hearing on Online Platforms and Market Power in the Rayburn House office Building, July 29, 2020 on Capitol Hill in Washington, DC.

Asked about the ongoing #StopHateForProfit ad boycott, Zuckerberg said: "We're very focused on fighting against election interference and hate speech", adding that Facebook has "build really sophisticated systems" to address both challenges.

"This would reduce opportunities for small businesses so much that would probably be felt at a macroeconomic level", Zuckerberg said.

It was clear that Facebook executives have been a little frustrated by the attacks on the service.

The boycott aimed at pressing Facebook to act on toxic and hateful content has the support of more than 900 companies and organizations.

Facebook had joined other social-media companies in predicting that pandemic fallout would damp its near-term prospects. Although some were among Facebook's biggest individual spenders, the bulk of Facebook's ad revenue comes from small businesses.

"Facebook has successfully attracted digital-native businesses to its platform, especially those that market products or services that can be used or consumed by people staying at home", she said. Armed with documents collected during the inquiry, the lawmakers asked Zuckerberg about Facebook's acquisitions of WhatsApp and Instagram, which Zuckerberg admitted were purchased in part to remove competition. Facebook's advertising-based business has also grown with this increase in usage. Facebook doesn't break out revenue for Instagram, though people familiar with the matter have said the mobile app brings in more than a quarter of Facebook's sales.

Zuckerberg also told the Congressional panel that he was listening to the advertiser boycott, but was "not going to set our content policies because of advertisers". We're seeing lower pricing and higher ad click-through rates which is a winning equation for brands. Looking ahead, we expect innovations like Facebook Shops to bring further commercial intent and conversion to the platform.

Other reports by Click Lancashire

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