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Facebook Inc (NASDAQ:FB) Takes Skeptics to School With Growth Surge

Facebook Inc NASDAQ:FB
Facebook Inc  is on a tear and it isn’t showing any signs of slowing down. The company, led by CEO Mark Zuckerberg, is reaching nearly one fifth of the world’s population (and more than half of the population having access to the Internet) – by no means a small achievement. However, a few investors have become skeptical of just how much growth could Facebook continue to have. The firm’s Q1 2016 earnings release put many of those fears to rest.
Facebook Inc NASDAQ:FB

Facebook Inc Sees Users Growing in Every Region

It seems that there is still a long way to go for Facebook Inc  and more ways to make more money than ever before. Morgan Stanley’s Brian Nowak said that these are still ‘early days’ and that Facebook’s reach, engagement and ad offerings will still improve. And indeed, the ad business reported a growth of 63 percent on a Y-o-y basis. This was mainly due to good business from North America.

In terms of monthly users, now the firm has 1.65 bn of them. Over the quarter, the total daily users grew by 13%, or 122 mn. So while the monthly active users were up 15% on a Y-o-y basis, mobile users were up by as much as 21%. In terms of growing engagement, Brian also said that these users are spending 50 minutes a day on the platform. In other words, if you put aside 8 hours of sleep in a day, more than 5% of the users’ total time in a day is being spent on Facebook.

Analysing the results, Brian also said that apart from the expected strong business in the USA, Facebook Lite helped propel growth in India and Brazil too. However, the growth in MAU was beyond their expectations in all 4 regions. Brian was particularly impressed by the rise in time spent by the user.

He added that this growth, combined with that seen in the daily user base is expected to continue. It will in turn boost Facebook’s monetization potential, because the increased engagement will lead to better user data and targeting. It will also make way for delivering more ad impressions.

Axiom’s Victor Anthony looked at the broader scheme of things and held up the report against what Alphabet is doing. He said that it is now clear that the two firms were ‘consolidating the majority of the economics of the ad shift from traditional media formats to online.’ He also added that in the long term, rivalry between the two will intensify further. In his view too, Facebook Inc (NASDAQ:FB) has a lot of potential left. He sees Facebook as on the road to becoming the world’s largest communications and entertainment platform. He agrees that there are plenty of ways in the future which it can use to make money. Therefore, it will do well in the race with Alphabet.

New Features to Come to WhatsApp

Talking of Alphabet, the Android edition of WhatsApp, like the iOS edition, is soon to get the feature of sharing ZIP files. The ‘voice mail’ feature on the other hand is believed to be limited to iOS only for now. Apart from that, users will also be able to ‘call back’ missed calls (or to leave them a message) right from the notifications without needing to actually open the app.

It is only recently that the ability to share PDF files was provided in WhatsApp on both iOS and Android. Now with sharing ZIP files, it seems that WhatsApp is sticking to going beyond messaging and becoming a file-sharing platform, because any kind of file can be included in ZIP files (including other ZIP files as well).

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