Analysts have had to lower expectations for Google Inc (NASDAQ:GOOG) in the past quarter as falling gross margins took a toll on projected annual results. Analysts on a consensus basis anticipate that the company will generate 9.5% in earnings growth for the full year.
Apple adds a face lift to technology
There still seems to be demand for smartphones, but it depends heavily on whether or not Apple Inc. (NASDAQ:AAPL) can secure subsidized contracts with different mobile carriers. For now, T MOBILE US INC (NYSE:TMUS) helped to boost demand for the iPhone as the device was put on sale through contract on the T MOBILE US INC (NYSE:TMUS) network in the second quarter. The iPhone was one of the top-selling devices for T MOBILE US INC (NYSE:TMUS). iPhone unit volumes jumped in the past quarter by 20%.
Apple Inc. (NASDAQ:AAPL) may have pent-up growth opportunities through wearable computing devices. It’s also nice to note that the next quarter could be full of surprises, as the next-generation iPad and iPhone devices are likely to be launched. There are also rumors of a bigger-screened iPhone device. An iPhone with a larger screen may boost mobile advertising revenue for Facebook Inc (NASDAQ:FB) and Google, especially when considering a larger screen offers better visuals for display advertisements.
The downside to large screens is the draw on battery, and the size of the device becomes prohibitive for normal use. You might as well rely on Skype conversations because the position of holding the phone in front of your face will be more comfortable than pushing it to your ear. Oh, and, by the way, Microsoft Corporation (NASDAQ:MSFT) reported that Skype calls were up by 41% year-over-year in the second quarter.
Conclusion
Better monetization of mobile should continue. The company that seems to be the best positioned in mobile advertising is Facebook Inc (NASDAQ:FB). We should also anticipate improvements in Google Inc (NASDAQ:GOOG)’s advertising strategy on mobile devices going forward.
Smartphone devices are shifting to screen sizes that are above 4.5 inches and with Apple following the herd, click-through rates and conversions may eventually improve. Let’s not forget that smartphone demand is still expected to grow internationally, so there’s a lot of untapped potential going forward.
The article Facebook Gets Mobile Right originally appeared on Fool.com and is written by Alexander Cho.
Alexander Cho has no position in any stocks mentioned. The Motley Fool recommends Apple Inc. (NASDAQ:AAPL), Facebook, and Google. The Motley Fool owns shares of Apple, Facebook Inc (NASDAQ:FB), and Google Inc (NASDAQ:GOOG). Alexander is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.
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