Today, Facebook is comprised of more than just the social network of the same name. Instagram, WhatsApp, Oculus and many, many more companies fall under the Facebook banner and as you might imagine, this means Facebook products attract billions of users everyday.
To be exact, 2.6 billion users make use of at least one Facebook product daily according to the firm’s Q4 and full year financial results for 2020.
During December, Facebook reported that daily active users amounted to 1.84 billion, an 11 percent increase year on year.
Revenue for the fourth quarter amounted to just over $28 billion while revenue for the year was $85.96 billion, a 22 percent increase compared to 2019.
“We believe our business has benefited from two broad economic trends playing out during the pandemic. The first is the ongoing shift towards online commerce. The second is the shift in consumer demand towards products and away from services. We believe these shifts provided a tailwind to our advertising business in the second half of 2020 given our strength in product verticals sold via online commerce and our lower exposure to service verticals like travel. Looking forward, a moderation or reversal in one or both of these trends could serve as a headwind to our advertising revenue growth,” Facebook’s chief financial officer, David Wehner, said in a statement.
What is interesting to note is Facebook’s outlook for 2021.
While the first two quarters of this year will see the “lapping” of periods in 2020 where growth was negatively impacted, the second half of the year may prove tougher for Facebook’s year on year growth rated.
This growth may additionally be hampered should trends that flourished in 2020 subside. One of these trends that has helped Facebook greatly was an increase in ecommerce.
But something else that has Facebook’s back up is the forthcoming launch of iOS 14.
The changes to the Apple operating system are meant to protect users from apps collecting more data than they should, and you can see why Facebook would be worried.
“Apple’s policy will prohibit certain data collection and sharing unless people opt in to tracking on iOS 14 devices via the prompt. As more people opt out of tracking on iOS 14 devices, ads personalisation and performance reporting will be limited for both app and web conversion events,” Facebook warned advertisers in a blog post.
Right now there is no telling how the iOS 14 changes will impact Facebook’s advertising model but it is being cautious as regards forward looking statements.
With that having been said, advertising is by far Facebook’s biggest money maker and if Apple’s operating system starts to eat into that bottom line we do wonder how Facebook will react.
[Source – Facebook]