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Facebook ended 2020 much stronger financially than at the start of the year, proving that its business could withstand the coronavirus pandemic and even thrive thanks to the skyrocketing screen time over the past 12 months.
The company on Wednesday reported earnings of more than $ 28 billion in the fourth quarter with earnings of $ 11.2 billion, a 31% and 53% year-over-year increase, respectively. When it comes to usage, Facebook is on the rise everywhere, with more than 1.84 billion people using its main social network at least once a day in December 2020, an 11% year-over-year increase. other. As of December 31, 2020, more than 2.8 billion people consult Facebook at least once a month, a jump of 12% from the previous year.
When measuring usage of its bundled family of apps which also includes Facebook Messenger, Instagram, and WhatsApp – a metric the company calls “active people in the family” – the numbers are even better, as usual . More than 2.6 billion people visit one of Facebook’s apps every day (up 15% from 2019), while more than 3.3 billion people consult one of the apps at least once per month (up 14%).
Facebook’s business was largely unaffected by its October decision to temporarily ban political advertising after the U.S. election. (The company extended the ban for a month in December, but exempted advertising for Georgia Senate races.) It was predictable; Political advertising is paltry compared to the ad spend of ecommerce, standard retailers, and small businesses on the platform.
Facebook’s “Other” category, which includes its Portal video chat devices and Oculus virtual reality business, also performed very well in the last quarter, with revenue rising 156% to $ 885 million. Last quarter featured the launch of Facebook’s second-generation Quest wireless headset, Quest 2 and Portal devices saw increased sales year-round as people shifted to remote work and virtual hangouts at home. .
But that’s not all good news for Facebook. The company says it “will continue to face significant uncertainty as we manage a number of cross-streams in 2021” in its earnings report, signaling concerns that the company will not be able to sustain the same rate of year-over-year growth as it enters the second half of 2021.
This report was not said in its report, Apple’s privacy changes that could have significant consequences for Facebook’s advertising activity, including the new mandatory privacy labels and Apple’s upcoming plan to require app makers to obtain user consent to track people on iOS devices. Earlier this month, Facebook’s WhatsApp delayed a new privacy policy update that sent users running away from the app for competitors like Signal and Telegram.
“At the same time, in the first half of 2021, we will go through a period of growth that has been negatively impacted by the reduction in advertising demand during the early stages of the pandemic,” the company writes. “As a result, we expect year-over-year growth rates of total revenue to remain stable or accelerate slightly sequentially in the first and second quarters of 2021. In the second half of the year, we will overlap periods of increasingly strong growth, which will put significant pressure on year-over-year growth rates. “
Facebook also continues to survive its fair share of public relations and platform moderation controversies over disinformation, election interference and the recent ban by former President Donald Trump. This comes on top of a new wave of U.S. regulatory oversight punctuated last month by an unprecedented Federal Trade Commission lawsuit aimed at unraveling the company’s costly Instagram and WhatsApp acquisitions. But these issues seem to have little effect on the company’s bottom line, yet.
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