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Monday, 21 June 2010

Facebook was profitable in 2009...2010 - is a formality

Facebook doesn’t publicly disclose its annual revenue and profit numbers. But the latest report, from Reuters, says it made up to $800 million in total revenue for 2009, with profit in the “tens of millions of dollars.” This number is higher than previous estimates, which have ranged as low as $500 million.

Why the wide range in estimates? From the report:

“They are downplaying their performance,” one source said, adding that 2009 revenue was more than double the previous year’s total. “There’s no upside in getting people’s expectations high, it’s always better to go low.”

Past reports put company revenue at $280 million to $300 million in 2008. We have estimated that Facebook made between $600 million and $700 million in revenue for 2009, mostly from growth in brand and performance advertising revenue. This year, we expect it to make up to $1.1 billion, largely through advertising. 

Facebook’s revenue from virtual goods has not been notably high, but that could change this year due to its efforts to make Credits the main virtual currency on its developer platform. Other estimates have pegged Facebook’s revenue growth to be as high as $2 billion.



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