Facebook seen reporting faster revenue growth on mobile ads

Facebook Inc. Chief Executive Officer Mark Zuckerberg is reaping benefits of a deeper push into mobile advertising at the social network he founded almost a decade ago.

Results due after the close of trading today will probably show that revenue rose 34% to $1.52 billion last quarter, according to analyst estimates compiled by Bloomberg. That would be the first growth acceleration since Facebook sold shares to the public in May. Revenue climbed 32% in the preceding two periods, a slowdown from earlier quarters.

Shares of Facebook have climbed 74% since slumping to a record in September, bolstered by signs of buoyant demand for marketing messages shown to users of social networks on tablets and smartphones. Mobile advertising made up 24% of the total in the fourth quarter, up from 14% in the prior period, according to Topeka Capital Markets Inc. That suggests new tools aimed at making ads more useful on small screens are having the desired effect with corporate customers.

“Mobile is definitely important to them, mainly because usage is shifting over to mobile,” said Victor Anthony, an analyst at Topeka Capital Markets who rates the stock a buy. “They’ll have to continue to show they’re making strides in monetizing mobile.”

Revenue from mobile doubled last quarter to $304 million, Anthony predicted. Analysts at JPMorgan Chase & Co. estimate that mobile contributed $384.2 million, or 27% of the total.

Stock Reversal

Facebook’s fourth-quarter profit excluding certain items probably rose to 15 cents a share, the average estimate compiled by Bloomberg. Net income slumped to $45.8 million, according to analysts’ projections.

The shares increased less than 1 percent to $30.97 at 9:38 a.m. in New York. Through yesterday, the stock had dropped 19% since the company sold shares at $38 apiece in a May 17 initial public offering, one of the most closely watched market debuts of the year.

Facebook fell for most of the succeeding five months, wiping out more than $40 billion in market capitalization, amid concerns that social-network and its advisers had set the IPO price too high for a company that hadn’t yet come to grips with a shift to mobile computing.

Shares reversed course beginning in early September amid signs that mobile advertising tools introduced in March were meeting with success. Zuckerberg reassured investors during a technology conference that month that mobile was a big focus for the company.

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