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Instagram reaches the 300 million user mark

Patricia Garner

Facebook's Q4 2014 earnings: Expect revenue growth and more (Part 7 of 10)

(Continued from Part 6)

Instagram reaches the 300 million users mark

Facebook (FB) acquired Instagram in 2012 for $1 billion. Finally, its investment in this deal is paying off. As of December 2014, Instagram surpassed 300 million users, adding 100 million users since March 2014. This is more users than Twitter (TWTR), which reported 284 million monthly active users at the end of Q3.

The vast majority of this growth came from outside the US after Instagram translated its app into more languages and connected users to public figures in their home countries. Instagram says more than 70% of its users are outside the US, compared with 65% in March.

A report from the Wall Street Journal states that as Facebook has matured, its youngest users (teenagers) are spending more time on other, newer mobile apps. Instagram has been a popular option. Instagram is helping Facebook by continuing to engage teenagers who are shifting away from Facebook or who are not on Facebook yet.

Since its Instagram acquisition in 2012, Facebook has been focusing on growing its user base first and monetizing the platform. Now, through the relaunched version of Atlas, advertisers can buy more targeted ads on Instagram. Instagram also announced it would add verified “badges” for celebrity users, athletes, and brands that will let users connect to authenticated celebrity accounts. Facebook is investing heavily to improve Instagram, and it believes that Instagram is on the right path.

 

According to a survey on 7,500 US teenagers conducted by Piper Jaffray this year, Instagram, Twitter (TWTR), and Facebook were the three most popular social networks among teenagers. Yahoo’s (YHOO) Tumblr, Google+, and Pinterest were less popular social networks. Read Market Realist’s Why  Facebook will benefit from Instagram’s popularity among teens.

To gain portfolio exposure to Facebook, you can consider exchange-traded funds (or ETFs) such as the Technology Select Sector SPDR ETF (XLK), where FB has weightage of 4%, and the PowerShares QQQ Trust, Series 1 (QQQ), with an FB weightage of 3.60%.

Continue to Part 8

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