Facebook Inc(NASDAQ:FB) has finally laid to rest the fears of those who were doubting the ability of the company to monetise its mobile subscriber base.
The company on Tuesday announced its quarterly results which showed that advertising revenues from mobile devices rose faster than expected and now contributes about 14 percent to its overall ad revenues.
This translates into revenues of $150 million in absolute numbers, a big jump from the $40 million to $50 million in the second quarter while in the first quarter it was zero.
Founder and Chief executive Mark Zuckerberg said that mobile was the most misunderstood part of the company.
“I want to dispel this myth that Facebook can’t make money on mobile,” he told analysts on a conference call.
With about half of its 1 billion user base shifting to accessing the platform on mobile devices, and the challenges that face marketers who advertise on them, it was felt that Facebook would have a tough time in growing its revenues.
Mobile advertising has been a key investor concern hanging over Facebook, helping slash more than $40 billion off its market value since its May IPO.
Facebook posted a 32 percent jump in third-quarter revenue to $1.26 billion, on the back of a jump in mobile advertising revenues.
Advertising revenue rose 36 percent to $1.09 billion, up from 28 percent growth in the second quarter. But revenue from its payments and other businesses increased just 13 percent to $176 million.
The world’s No.1 online social network company posted a net loss of $59 million, or 2 cents a share, in the three months ended September 30. It had a profit of $227 million or 10 cents a share a year earlier.
Excluding certain items, Facebook said it earned 12 cents a share, a penny higher than the average analyst expectation.
The company’s shares leapt 24 percent to $23 in the opening session.