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Behind The Brand

It's Official: A Billion People A Day Now Use Facebook

Facebook's quarterly results reveal that it continues to get bigger, more mobile, and better at monetizing users through advertising.

Facebook HQ in Menlo Park, CA.

[Photo: courtesy of Facebook]

In 2012, Facebook announced that it had a billion monthly active users—a headline-making accomplishment at the time. Last August, it disclosed that a billion people had visited on one particular Monday, the first time it had broken that barrier in a single day.

That Monday was no fluke. Today, as the company announced strong financial results for its third fiscal quarter, it said that as of September, the service now averages 1.01 billion users per day. For the first time, the company also officially has more than 1.5 billion monthly users—1.55 billion as of September, to be exact.

There was a time when pundits thought Facebook might struggle to make the transition to a world where smartphones matter more than laptops and desktop PCs. But 1.39 billion of those 1.55 billion monthly visitors use the service on a mobile device at least part of the time. And the company is successfully making money from all those eyeballs staring at smartphones: 78% of its advertising revenue is now mobile.

The company didn't break out how it is doing with video advertising. But it did reveal that 500 million people a day watch a total of 8 billion videos on Facebook, which is why it is investing in new features such as 360-degree videos. Facebook is also experimenting with a dedicated destination for videos, a move that could presage a more aggressive effort to go head-to-head with Google's YouTube. CEO Mark Zuckerberg seemed to hint at that scenario when he declared that Facebook has "a chance to build the best place to watch and share videos" during the company's quarterly conference call.

Facebook's latest stats on its user base across all its services

Overall, advertising sales hit $4.3 billion for the quarter, up 45% from a year ago. However, net income of $896 million was up only 11% from the previous year, indicating that the company is investing in its future vision—involving everything from artificial intelligence to Internet drones—rather than maximizing short-term profits.

One of Facebook's biggest investments in its future was the $2 billion acquisition of virtual-reality pioneer Oculus VR. Zuckerberg has often said that VR could be the next major computing interface. But when it came to the potential for the technology to have an immediate, epoch-shifting positive impact on Facebook and its bottom line, Zuckerberg is tamping down expectations. Goal one, he said during the conference call, is to build something that might appeal to the almost 250 million people who own an Xbox, a PlayStation, or a Wii. He noted that when smartphones first became mainstream more than a decade ago, the BlackBerry and Palm Treo sold hundreds of thousands of units a year—a figure, he said, that the company expects to be in the same ballpark as how Oculus's Rift headset might sell once it launches in the first quarter of 2016.

Facebook added 4 million users in the U.S. and Canada in the last quarter—a figure that shows that while it's possible to keep growing at home, the bigger inroads will happen in parts of the world where the service isn't pervasive and even Internet connectivity may not yet be a given, Through its Internet.org initiative, Facebook has been working to bring free versions of its own service and other basic offerings to people in 29 countries where wireless data is often unaffordable. The effort has not been without its controversies, especially in India, where it has been criticized for offering something less than a full-blown version of the Internet in all its richness.

If Zuckerberg has been fazed by the pushback, he hid it well during the conference call. India, he argued, "is the country in the world that benefits the most from connectivity...it makes a very big difference socially and for the economy." For every 10 new users the country gets on the Internet, he said, around one new person is lifted out of poverty and one new job is created.

As usual with Facebook, the overall tone of the call was of a company that sees its current success in its core business as an opportunity to ramp up its ambitions in an array of areas to levels that few competitors can match. "We've done a lot," said Zuckerberg as he ended his introductory remarks, "but there's always more to do."

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