For Facebook, North American Advertising Is Still King
On Thursday, shares of Facebook FB surged over 4% to hit a new all-time high after the company topped fourth-quarter expectations, even in the middle of what has amounted to a relatively tumultuous stretch for the social media giant.
The U.S. and Canada actually ranks last among Facebook’s regions in terms of DAUs (184 million) and MAUs (239 million). But when it comes to revenue generation—which is what really matters—the region continues to shine.
In the fourth-quarter, Facebook saw its total revenues in the U.S. and Canada soar by 40.29% year-over-year to hit $6.392 billion. Sequentially, Facebook’s sales in the region jumped by $1.359 billion—driven, in large part, by increased ad spending during the holiday season.
The U.S. and Canada accounted for 49.27% of Facebook’s total Q4 revenues. Second place Europe, which boasts 131 million more MAUs, accounted for a more proportional 25% of quarterly revenues.
What’s more, Facebook’s average revenue per user in the U.S. and Canada jumped 35% from the year-ago period to $26.76 per user—with all but $0.51 coming exclusively from ad revenue. Average revenue per user in Europe came in at $8.86.
Investors might be a little concerned to note that DAUs in the U.S. and Canada dropped sequentially from 185 million to 184 million, while MAUs remained flat. Still, both experienced year-over-year gains.
The smartphone market is the U.S. is booming, and this has helped Facebook. Mobile advertising revenue represented roughly 89% of advertising revenue in Facebook’s fourth quarter, up from approximately 84% of advertising revenue in the year-ago period.
Advertising as a whole, accounted for 98.5% of the company’s $12.972 billion Q4 revenues. This growth was propelled by the fact that the average price per ad on Facebook rose by 43%. As advertisers find it increasingly hard to reach users via television and print, this number could climb even higher.
Going forward, Facebook investors might be even happier to note that the social media giant is indeed projected to grab an even larger slice of the advertising pie. Facebook is expected to account for 11.3% of all U.S. advertising spending in 2019, passing the entire print category, according to a recent eMarketer report.
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