Facebook Beats as Mobile Revenue Jumps to 41 Percent of Ads Business
Facebook's numbers are in, and they look good across the board — especially in mobile. — The social giant posted its second-quarter earnings on Wednesday afternoon, reporting earnings per share of 13 cents on revenue of $1.81 billion.
Context & Ripple Effects
Facebook's second-quarter 2013 report lands a year after the company's rocky post-IPO stretch, and it answers the question that has hung over the stock since then: whether the shift of its audience to phones could be monetized at scale. The quarter shows revenue of $1.81 billion on EPS of $0.13, with mobile climbing to 41% of the ads business — the first clear evidence the transition is producing dollars, not just usage.
The scale behind the number is what makes it credible: TechCrunch's read of the same results counts 1.15B monthly users (up 21% year over year), 699M daily users (up 27%), and 819M mobile monthly actives (up 51%). The company also flagged days earlier that Facebook for Every Phone had passed 100 million monthly users, extending reach beyond smartphones. Investors treated the print as vindication — shares opened up roughly 26% the next morning.
First-order effects
- Investors reprice immediately: the stock opens about 26% higher after the beat, reversing the discount the market had applied to Facebook's mobile story since its 2012 IPO.
- Advertisers get proof that Facebook's mobile feed placements convert at scale — 41% of ad revenue from mobile means brand and performance budgets allocated to Facebook are now substantially funding a phone-first product.
Second-order effects
- Rivals selling mobile attention — Google, Twitter, and the app-install networks — face a competitor whose mobile ad inventory grows automatically as its 819M mobile monthly users deepen engagement, pressuring their pricing and forcing faster product responses in native feed ads.
- Facebook's low-end distribution push, anchored by Facebook for Every Phone's 100M+ monthly users, widens the addressable audience beyond premium smartphones, pulling emerging-market carriers and OEMs into its monetization funnel.
Third-order effects
- If the mobile mix keeps climbing, ad-industry planning — budgets, creative formats, and measurement — consolidates around the news feed as the default unit of social advertising, with 'mobile share of revenue' becoming the metric investors demand from every consumer internet company.
- The pattern points toward valuation of consumer platforms by revenue-per-active-device rather than raw user counts, since Facebook's quarter shows engagement growth only matters once each device carries an ad load.
The trend: Social networking is completing its pivot from desktop display ads to mobile-native feed advertising, and Facebook's 41% mobile mix marks the point where that transition becomes a proven revenue engine rather than an open question.