Brad Hoppmann: Facebook Inc (NASDAQ:FB) is no fluke. Mark Zuckerberg’s crazy idea is killing old media, earning billions, and just getting started. What’s not to “like?“
Everything about Facebook’s (FB) second quarter was huge. Revenue, profits, profit margins, users, growth, you name it — very few companies post these numbers barely two years after going public.
Will FB stumble eventually? Yes, but Zuckerberg is 30 years old. He has all the time in the world.
About six months ago, I wrote an afternoon edition called Facebook Cracks the Code to Your Eyeballs. The occasion was Facebook’s fourth quarter 2013 earnings report. Here’s a quote from that issue on Jan. 30, 2014:
Facebook shares climbed an astonishing +14.1% today. The original social network proved doubters wrong with last night’s earnings report.
The bullish reaction boiled down to one thing: mobile advertising. Facebook said more than half of the last quarter’s revenue came from advertising on mobile devices.
Why is this a big deal? The entire media industry has been wrestling with smartphones and tablets ever since the first iPhone launch in 2007.
Industry leaders immediately saw the potential for location-specific advertising. In practice, however, no one could solve all the technical and business challenges until now.
Last quarter, Facebook finally cracked the code. Their latest techniques like “sponsored posts“ are visible enough to get the response advertisers want, but not so intrusive that they suppress usage.
Facebook shares closed at $61.08 that day. In hindsight, I should have suggested buying the stock with both hands. FB ended at $74.98 today and set a new $76.74 all-time record high.