Despite an unprecedented boycott by its major advertisers and the economic impact of the novel coronavirus pandemic, social media giant Facebook easily beat analysts' estimates for quarterly revenue while also forecasting growth on the similar lines for the future quarters. The driver of its estimate beating performance was the digital ads tools of thee company.
Following the reporting of an 11 per cent growth in revenues, which was the slowest ever for the company, the share of the company rose by 7 per cent in extended trading. The growth reported by Faceebook as far higher than the estimates of analysts which as at 3 per cent as shown by IBES data from Refinitiv.
There as a 10 per cent growth in ad sales of the company which typically account for almost all of Facebook's revenue to reach $18.3 billion in the second quarter. The company said that the novel coronavirus pandemic induced lockdowns and stay at home orders in countries all across the world prompted people to spend more time online and business focused quickly on e-commerce modes for sale.
The company reported a rise of its monthly active users at 2.7 billion which was higher than analysts’ estimates of 2.6 billion.
It is pertinent to mention that a day prior to the company reporting the estimate breaking performance, its CEO Mark Zuckerberg, was faced to sharp questions and comments in a congressional hearing in the United States.
Zuckerberg was among four top tech CEOs who were grilled by lawmakers on alleged abuses of market power.
Notes of defiance about both demands for aggressive regulation and the July advertising boycott ere sounded by Facebook executives on a call with investors. The ad boycott of Facebook as aimed to put pressure on the company to take more action against hate speech.
He was "troubled" by calls to "go after" targeted advertising online, Zuckerberg said. "This would reduce opportunities for small businesses so much that it would probably be felt at a macroeconomic level. Is that really what policymakers want in the middle of a pandemic in recession?"
While refuting the aims of the boycott, he said that there as a hiatus between "how the vast majority of people actually experience our services and the impression you get if you're just reading much of the commentary about Facebook."
The company was apparently not hit to any significant degree by the boycott campaign which s supported by some of the major advertisers of Facebook including the likes of Unilever, Starbucks Corp and Coca-Cola Co.
There was a 10 per cent year on year growth in ad sale in the first three weeks of July, Facebook said which was in line with the overall rate of growth for the entire second quarter. The social media company projected that its third quarter ad revenue growth would be consistent with the second quarter growth rate, which was higher than what was forecast by analysts at Wall Street.
The boycott Facebook campaign was joined by about 1,100 companies. And despite some of the highest spending individual corporate advertisers supported the boycott, most of the ad revenue of the company is accounted for by small businesses.
Observers "wrongly assume that our business is dependent on a few large advertisers." Zuckerberg said.
(Source:www.economictimes.com)
Following the reporting of an 11 per cent growth in revenues, which was the slowest ever for the company, the share of the company rose by 7 per cent in extended trading. The growth reported by Faceebook as far higher than the estimates of analysts which as at 3 per cent as shown by IBES data from Refinitiv.
There as a 10 per cent growth in ad sales of the company which typically account for almost all of Facebook's revenue to reach $18.3 billion in the second quarter. The company said that the novel coronavirus pandemic induced lockdowns and stay at home orders in countries all across the world prompted people to spend more time online and business focused quickly on e-commerce modes for sale.
The company reported a rise of its monthly active users at 2.7 billion which was higher than analysts’ estimates of 2.6 billion.
It is pertinent to mention that a day prior to the company reporting the estimate breaking performance, its CEO Mark Zuckerberg, was faced to sharp questions and comments in a congressional hearing in the United States.
Zuckerberg was among four top tech CEOs who were grilled by lawmakers on alleged abuses of market power.
Notes of defiance about both demands for aggressive regulation and the July advertising boycott ere sounded by Facebook executives on a call with investors. The ad boycott of Facebook as aimed to put pressure on the company to take more action against hate speech.
He was "troubled" by calls to "go after" targeted advertising online, Zuckerberg said. "This would reduce opportunities for small businesses so much that it would probably be felt at a macroeconomic level. Is that really what policymakers want in the middle of a pandemic in recession?"
While refuting the aims of the boycott, he said that there as a hiatus between "how the vast majority of people actually experience our services and the impression you get if you're just reading much of the commentary about Facebook."
The company was apparently not hit to any significant degree by the boycott campaign which s supported by some of the major advertisers of Facebook including the likes of Unilever, Starbucks Corp and Coca-Cola Co.
There was a 10 per cent year on year growth in ad sale in the first three weeks of July, Facebook said which was in line with the overall rate of growth for the entire second quarter. The social media company projected that its third quarter ad revenue growth would be consistent with the second quarter growth rate, which was higher than what was forecast by analysts at Wall Street.
The boycott Facebook campaign was joined by about 1,100 companies. And despite some of the highest spending individual corporate advertisers supported the boycott, most of the ad revenue of the company is accounted for by small businesses.
Observers "wrongly assume that our business is dependent on a few large advertisers." Zuckerberg said.
(Source:www.economictimes.com)
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