It’s been expected for some time, but the day has finally arrived: In 2009, Facebook was profitable. In all, it made $800 million–double what it made in 2008.
That news comes from Reuters, which used “two sources familiar with the situation” to confirm the figures. And if true, it’s a remarkable indicator of Facebook’s prospects as powerhouse of ad sales. Earlier this year, Marc Andreessen, who sits on Facebook’s board, was estimating that in 2009, the company would make about $500 million. And various industry analysts had pegged the 2009 revenues at between $500 and $700 million.
Back in September, Facebook announced that it was free cashflow positive–meaning the money it’s earning was enough to cover operating expenses and capital expenditures.
Obviously, Facebook has every incentive to lowball its earnings–surprising the market with ridiculous numbers when their long-expected IPO finally hits is the surest way to generate stock market heat. “They are downplaying their performance,” a source told Reuters. “There’s no
upside in getting people’s expectations high, it’s always better to go
low.” Nonetheless, in the last year, the number of advertisers on Facebook has increased 400%. And in the past year, its user base has swelled from a now-quaint 150 million to a half a billion.
So if you see Marc Zuckerberg in a bar, drinks should be on him. Though for now, Facebook is insisting it has no plans for an IPO anytime soon.
[Image by AMagill]