Facebook Inc (NASDAQ:FB) wowed the markets after close on Wednesday when the company announced that their mobile strategies were looking successful.
The announcement came in as quite a shock to investors when they learned that close to one-third of Facebook Inc (NASDAQ:FB) advertising revenue now comes from smartphones and tablets.
The announcement came as part of a quarterly earnings report from the social giant. Mobile revenue was not the only talk at the event as the company also announced that revenues were up some 38% year over year to just over $1.4 billion.
Net income also grew, by a rate of 6.8% to $219 million. That’s actually not that bad, although it doesn’t even begin to put a dent in that humongous P/E ratio.
How About That Mobile?
Mobile ad revenues at Facebook Inc (NASDAQ:FB) came out to be $374 million. Facebook specifically stated that this was 30% of all advertising revenues and that mobile saw a 22% growth over the last quarter.
I am not an avid user of Facebook Inc (NASDAQ:FB), but when I do use the service, it tends to be on a cell phone. I assume that there are a lot of Facebook users out there that are like me, which is why this is such a big deal to the company.
The types of mobile ads making the most money are those that are trying to entice the user to download another app. During the conference call, the company noted that more than 25 million app downloads were generated due to these ads.
Yelp Inc (NYSE:YELP) has approximately 9.2 million people that use their app on a monthly basis. These people are looking for places to eat, or somewhere to stop and grab a drink. In that sense, Yelp has an inherent advantage in that there users are opening the app and looking to buy.
Close to 25% of Yelp’s ads are those that are served up on their mobile platform. Perhaps greater emphasis on getting people out of the house, and on their phones could prove to be a great bonus to Yelp Inc (NYSE:YELP)’s business.
Groupon Inc (NASDAQ:GRPN) is another company who can benefit greatly from mobile, especially the Groupon Now feature that the app carries.
While it may be old news, over 30% of North American transactions at Groupon are completed on mobile devices.