Facebook has just released its quarterly earnings and once again has brought a surprise to the world with massive revenue growth – revenue up at $9.3B for the second quarter, and if it continues in this direction – likely with a stronger Q4 with possibly same or lower third quarter, Facebook can land close to $40B in revenue in 2017. Most analyst predicted the social media market this year to $40B, and its probably time to update these estimates. With YouTube also announcing being at 1.5B users and my estimate is it has $10 – 20B in revenue – we are looking at a social market that will near $100B in revenue. What are the key things we learnt in yesterdays earnings:

Facebook Q2 revenue $9.3B, closing H1 2017 with $17,35B in revenue
Facebook now has 2B monthly active users
87% of all ads revenue is now mobile
Facebook has 3 “stories” platforms bigger than Snapchat
WhatsApp, Instagram Stories, Messenger are still not monetised in Q2, Facebook is testing ads in Messenger

An update on Facebook vs. Snapchat

Facebook now has 3 platforms bigger “stories” platforms than Snapchat Stories and Snapchat is falling in popularity outside the U.S., where the 3 platforms (Instagram, WhatsApp, and Messenger) by Facebook are getting a lot of attention. This must have been clear to everyone in the social world, that Instagram will win this fight eventually. Facebook has a track record of if it wants to copy something and get it right, it easily can…

Investors are finally catching up with this reality, and Snapchat stock is not doing so well either, down heavily below IPO price, which is something we spoke about – but its still worth $15B. Snapchat might finally be getting close to its real price of around $7 – 12B, depends on how it really figures out its growth and revenues over 2017.

I talked about why the only way for Snapchat was an IPO way before its IPO, and the prediction I made with going public… The stock price is falling short of Snapchats valuations before its IPO, but with preferences gone, the Snapchat founders can be happy they can sell their stock as they please (hey, they’re still billionaires…). Snapchat Q2 announcement is coming in August, so I guess we’ll have to wait and see on the outcome…

Credit to: Jan Rezab

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