Facebook's Q1 2013 earnings are in, with total revenues of $1.46 billion and mobile ad revenue constituting 30 percent of overall ad revenue. As expected, Facebook calls 2013 "an investment year," so its operating margin fell from 36 percent in Q1 2012 to 26 percent this quarter. Facebook is obviously willing to spend money and see lower profit margins now to ensure that it is well-positioned in mobile.
Last quarter, Facebook pulled in revenues of $1.59 billion, by comparison. For this quarter, Wall Street analysts were reportedly expecting revenues of $1.44 billion and $0.12 EPS. Facebook's $1.46 billion and $0.13 EPS very slightly beat expectations on revenue, but not profits.
Facebook says that it had 665 million daily active users on average in March, up from 618 million in Q4 2012 and a 26 percent increase year-over-year. Monthly active users hit an impressive 1.11 billion — Facebook had hit a billion active users last October.
Focusing on mobile now, worrying about big profits later
Facebook's total user count may be impressive, but the real question everybody has long been asking is whether it would be able to continue to add mobile users and make money off of them with ads. Last quarter, Facebook reported 680 million monthly active users and that 23 percent of its ad revenue came from mobile. This month, total mobile monthly active users increased to 751 million, which is a 54 percent increase year-over-year. Mobile-only monthly active users has more than doubled in the past year, showing just how important this sector is for the company. Meanwhile, Instagram managed to hit the 100 million monthly active user mark.
As far as how all this affects Facebook's bottom line, mobile ad revenue constituted 30 percent of Facebook's total $1.25 billion in ad revenue, a solid increase from last quarter. Facebook's mobile ad revenue is therefore very clearly moving in the right direction, but perhaps not quickly enough.
Facebook only introduced its new Android software, Facebook Home, in April. It doesn't (yet) specifically serve ads on the homescreen, so it's not likely to have made much of an impact on Facebook's bottom line. Similarly, it's unlikely that there has been any significant difference made from the HTC First, which comes with Home pre-installed. However, we're sure the company is eager to talk about them — and hopefully talk about actual install numbers for Home. Facebook will start its earnings call at 2PM PT / 5PM ET, and we'll let you know if we hear more details then.