Making Facebook richer

   "As others have said, Facebook’s revenue and subsequent profits is a result of advertising revenue. In 2015 95% of their revenue was from advertising.

Here is a excerpt from Facebook’s 2015 Annual Financial Report:

We generate substantially all of our revenue from advertising. The loss of marketers, or reduction in spending by marketers, could seriously harm our business.

Substantially all of our revenue is currently generated from third parties advertising on Facebook. For 2015, 2014, and 2013, advertising accounted for 95%, 92% and 89%, respectively, of our revenue. In addition, we have recently introduced advertising on Instagram. As is common in the industry, our marketers do not have long-term advertising commitments with us. Many of our marketers spend only a relatively small portion of their overall advertising budget with us. We expect our ability to grow advertising revenue will continue to be dependent on our ability to generate revenue from ads displayed on mobile devices. In addition, marketers may view some of our products as experimental and unproven. Marketers will not continue to do business with us, or they will reduce the prices they are willing to pay to advertise with us or the budgets they are willing to commit to us, if we do not deliver ads in an effective manner, or if they do not believe that their investment in advertising with us will generate a competitive return relative to other alternatives."

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#advertise
#budgets
#marketers
#generate
#devices
#thirdparties
#business
#facebook