Facebook's revenue per user is rising significantly – Facebook's Revenue Per User Rises Steeply

Published on: February 4, 2019 / Updated on: February 4, 2019 – Author: Konrad Wolfenstein

Despite criticism that Facebook is nothing more than a breeding ground for misinformation, data misuse, and hate speech, the company finished the year strong, exceeding analysts' expectations in its fourth-quarter earnings report on Wednesday. The company generated $16.91 billion in revenue in the three months ending December 31, surpassing its previous record by more than $3 billion.

And although Facebook's user base is certainly not growing as rapidly as it once did, there are no signs of the "mass exodus" that many experts predicted after the Cambridge Analytica scandals, Russian bots, and other issues last year. The world's largest social network now has 2.32 billion monthly active users, two-thirds of whom, or 1.52 billion people, access the platform daily.

The recent revenue surge is primarily due to the company generating increasingly higher revenue per user. Last quarter, the global average revenue per user reached $7.37, more than five times higher than during the same period in 2011. However, there is a limit to how much money Facebook can extract from its users, and during yesterday's earnings call, CFO David Wehner warned that advertising revenue growth is likely to slow throughout 2019, as people's news feeds are already saturated with ads and usage is shifting toward Stories, which are not yet as effectively monetized.

Defying all critics saying Facebook is nothing but a hotbed for misinformation, data abuse and hate speech, the company finished the year off strongly, beating analyst expectations across the board in its fourth-quarter earnings report on Wednesday. The company netted $16.91 billion in revenue in the three months ending December 31, beating its previous record by more than $3 billion.

And while Facebook's user base certainly isn't growing as quickly as it used to, there are no signs of a “mass exodus” that many experts had predicted after last year's scandals surrounding Cambridge Analytica, Russian bots etc. The world's largest social network now has 2.32 billion monthly active users, of which a stable two thirds, or 1.52 billion people, access the platform every day.

The latest jump in revenue can mainly be attributed to the fact that the company generates more and more revenue per user. In the past quarter, global average revenue per user amounted to $7.37, which is more than five times the per-user haul of the same period in 2011. There is a limit to how much money Facebook can squeeze out of its users however and during yesterday's earnings call, the company's CFO David Wehner warned that ad revenue will probably grow slower throughout 2019 as people's news feeds are already at their limit in terms of ad load and usage is shifting towards stories, which aren't monetized as effectively yet.

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