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Enid Burns for redOrbit.com – Your Universe Online
Facebook released its second quarter earnings this week – the first report since its fumbled IPO in May – and the industry watched as the mixed report of revenues offset by fees relating to the IPO unfolded.
In its presentation, Facebook showed a number of slides offering data on its user base including geography and income. Now that the financial numbers are crunched, the industry is dissecting some of the other numbers Facebook offered up during its earnings call.
The social network gets 955 million monthly active users. This number has consistently seen quarter-on-quarter growth. In Q1 Facebook reports it had 901 million monthly active users, and 845 million the quarter before that. It’s an impressive number, and Facebook hoped that analysts and investors would just look at the top number, and not the numbers underneath in the chart.
If you break down Facebook’s 955 million monthly active users, the story gets interesting. Of those 955 million, 186 million reside in North America including the US and Canada. Europe accounts for 246 million and Asia comprises 255 million. Facebook then lumps in the “Rest of the World,” which includes Africa, South America and other countries in the developing world, into a category that makes up 268 million of Facebook’s 955 million monthly active users. That’s the largest piece of the pie. And that big portion of users might not be the news advertisers wanted to hear.
The problem is that advertisers want their ads to be seen by an audience with buying power. Advertisers don’t want to pay for ad impressions served to an audience who doesn’t have the income to purchase their products, if those products are even available in those countries. And this emerging audience is the new largest segment on Facebook’s global social network.
For a US audience, Facebook made roughly $5 annualized per user in the first quarter of the year, and for comparison, Google makes about $20 per user, per year. That’s according to VentureBeat.
A separate slide that Facebook provided during its earnings call shows that revenue actually increased in the US but also everywhere else. Google earned $1,184 billion in revenue in Q2, 2012. The chart also breaks that revenue down by geography. While the rest of the world category makes up the largest segment as far as people, it makes up the lowest sum in terms of revenue. The US and Canada earned Facebook $590 million during the second quarter of this year. Europe brought in $346 million; Asia accounted for $135 million; and the rest of the world earned the social networking site $113 million.
The VentureBeat article lists a breakdown of how much Facebook makes from a user each quarter, by geography. Each Facebook user in the US and Canada brings in an average $3.20 per quarter for the social networking site. Users in Europe bring in $1.43 each; Asia $0.55; and the rest of the world earns Facebook about $0.44 per user per quarter. The revenues per user are lower.
In the wake of these numbers, Facebook has some PR work cut out for it. The first step might be to concentrate on regional and local advertising services within the social networking site. That way US advertisers can be assured that their ads are being shown to US consumers. If the rest of the world segment becomes a majority, instead of simply being the largest segment on Facebook, the company might want to beef up sales in that part of the world, which might mean advertising to that segment – or even al of Facebook – might need to take on a different format. Majority rules, and Facebook will have to take this new majority segment seriously and figure out how to monetize it.
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2012-07-28 07:08:29
Source: http://www.redorbit.com/news/technology/1112665282/closer-look-at-facebook-numbers/