Facebook FY - Powering Through Scandals

Diversified social media giant Facebook turned 15 yesterday, a big milestone for a company that was started in a university dorm room. Accel Partners invested $14.8 million in a website called 'the facebook.com' back in 2005, today the returns are north of $5.6 billion or 378 times their initial outlay.

Facebook owns three of the five platforms that got to 100 million active users the fastest i.e. Facebook, WhatsApp and the mighty Instagram. Mark Zuckerberg's Midas touch is unparalleled, having bought Instagram for just $1 billion - - a business that could be worth well above $100 billion today.

Facebook reported a robust set of numbers to put an end to what has been their most controversial year yet. The company has had blunder after blunder from the Cambridge Analytica data breach, to recently collecting data from teenagers, which to be fair they received parental consent for.

The social media company reported a 9% increase in both its daily and monthly active users on the Facebook platform. The growth came from Asia-Pacific; India, Indonesia, and the Philippines. The phone is still the most important screen in our lives and Facebook still owns six of the top ten Apps. Since we spend 80% of the time "in App" Facebook is going to continue to print strong numbers.

The company netted $16.91 billion in revenues in the quarter ending December 31, beating its previous record by more than $3 billion. Facebook's most important markets which contributes 90% to revenues, North America and Europe, grew revenues by 55% and 19%, respectively. Its global average revenue per user is $7.37, a number that's grown five fold since listing.

You will find more infographics at Statista

Many publications have been expecting Facebook to lose subscribers faster than ever but that has not been the case. The largest social network now has 2.32 billion monthly active users, of which 1.52 billion of them use the platform every single day!

Facebook's headcount has increased by 42% to over 35 000, of which management reported that more than 30 000 of the employees were working on security, to address the social issues I have stated above. Founder, CEO and Chairman Mark Zuckerberg said the following on the topic:

"We've fundamentally changed how we run this company. We've changed how we build services to focus more on preventing harm. We've invested billions of dollars in security, which has affected our profitability. We've taken steps that reduced viral videos in Facebook by more than 50 million hours a day to improve well-being."

This leads me to the same conclusion as the one I had back in August last year. Facebook management seems to be learning from recent history with regards to the important role the company plays in society, given the general demise of newspapers. By taking action to clear out these accounts, Facebook is choosing the long-term good over short-term profits.