Facebook reported strong results for the fourth quarter, which ended December 31st.
Thanks to increased advertising spending by companies, the social media giant’s revenues rose by £7 billion from $21.08 billion to $2.807 billion. This was higher than expected by analysts who estimated revenue of $264 billion.
In addition to revenue, the number of users on the Facebook platform also rose by 12% to 28 billion.
The group saw strong deals as Instagram shopping and Facebook marketplace expanded and more people started shopping online.
In its transaction update, Facebook said: The first is the ongoing shift to online commerce. The second is a shift in consumer demand for products and apart from services.
“We believe these shifts provided a tailwind for the advertising business in the second half of 2020 given the strengths of the vertical sector of products selling lower vertical exposure to services such as online commerce and travel. Looking forward to it, mitigation or reversal of one or both of these trends could serve as a headwind towards advertising revenue growth.”
This year’s results came despite a difficult time for Facebook as the group faced concerns about advertisers boycotts, anti-trust actions and content moderation regarding the US presidential election.
Tamara Littleton, analyst and CEO of social media agency The Social Element, commented on the strong results: “At this point, Facebook doesn’t seem to get in hand, but the fact remains. Facebook has consistently damaged its reputation by adding profits ahead of everything.”
Facebook shares closed -3.51% lower at 272,14.
