A convenient peek under Facebook’s financial kimono shows revenues doubling year on year, but is this just a tactic to obscure worrying user figures?
As a private company, but one with arguably an unprecedented influence and commercial impact, Facebook’s revenues have always been closely followed. On its scale, it epitomises the challenge of next generation social sites who now need to prove that there is real money behind the social media phenomenon. The latest reported figures look extremely good.
Ahead of an expected IPO early next year, it’s more than a little convenient that some very healthy revenue numbers have “leaked” to Reuters. Scepticism aside, how do they look?
According to one source, Reuters reports, revenues reached $1.6bn for the first half of 2011, with net income at $500m. There’s no breakdown of how much of that is made up of advertising and how much comes from revenue sharing on virtual goods in games and apps.
In the documents Goldman Sachs used to hawk its secondary market investment deal to potential investors, the firm claimed Facebook’s revenues totalled $1.2bn for the first three quarters of 2010, with net income of $355m. That was roughly in line with some rather woolly media reports that ranged from $1.2bn to $2bn for the full year. That means Facebook’s revenues have roughly doubled year on year. Guardian