Facebook on Wednesday reported better-than-expected second quarter financial results, in large part due to higher ad prices. Still, while the social media giant continues to derive huge sums from ad sales, Facebook executives have once again warned of “ad targeting headwinds” that could slow growth.
Facebook’s second-quarter net profit was $ 10.4 billion. Revenue was $ 29.08 billion, up 56% from the previous year. Analysts expected revenue of $ 27.82 billion.
“We’ve had a strong quarter as we continue to help businesses grow and people stay connected,” CEO Mark Zuckerberg said in a statement. “I am excited to see our major initiatives around the creators and community, business and building of the next IT platform come together to start bringing the vision of the metaverse to life.”
56% increase in advertising revenue
Advertising revenue for the quarter was $ 28.58 billion, up 56%. “Other” income was $ 497 million, up 36%.
According to CFO Dave Wehner, the growth in ad revenue in the second quarter of 2021 is due to a 47% increase in the average price per ad and a 6% increase in the number of ads served.
“In the third and fourth quarters of 2021, we expect year-over-year total revenue growth rates to slow significantly on a sequential basis, as we end periods increasingly strong growth, ”Wehner said in a statement. “Looking at the two-year growth, to exclude the impact of the COVID-19 recovery, we expect the two-year total revenue growth to slow slightly in the second. semester 2021 compared to the growth rate of the second quarter “.
The ATT threat still not sensitive to Facebook
He added: “We continue to forecast increased headwinds in ad targeting in 2021 due to regulatory and platform changes, including recent iOS updates, which are expected to have a greater impact in the third quarter. compared to the second quarter. This is factored into our outlook. ”
Last quarter, Wehner issued a similar warning. He specifically said that Apple’s iOS 14.5 update, released in April, would impact Facebook’s business in the second quarter. Facebook has complained about Apple’s new App Tracking Transparency (ATT) feature, which requires app developers to obtain user’s permission to track their activity on other apps and websites when they are uses an iPhone or iPad.
The number of daily active Facebook users was 1.91 billion on average for the month of June 2021, an increase of 7% from the previous year. The number of monthly active users was 2.9 billion in June, an increase of 7% from the previous year.
The number of people active daily on at least one of Facebook’s products – including Facebook, Instagram, Messenger and WhatsApp – was 2.76 billion on average for June, a 12% increase year over year. The number of people active monthly for Facebook’s “family” of products was 3.51 billion as of June 30, an increase of 12% year-on-year.