Facebook's Q4 Mobile Ad Revenue Likely to Be around $260 Million

Independent analyst Ben Evans has teased out a range of Facebook mobile usage and user data, partly derived from the company's own public statements and partly from his own calculations. You can read what he says here. Below I use some of his data and one of his charts. 

Mobile users as of Q3 2012 (mostly public numbers): 

  • 1.07 billion total users globally
  • 604 million total mobile users globally 
  • 470 million users of mobile apps/smartphone apps
  • 134 million users impliedly accessing Facebook via mobile web and not apps 

Screen Shot 2013-01-07 at 12.39.14 PM

Accordingly, roughly 44% of Facebook's global user base doesn't access the site on mobile according to the company's own data. However that figure is likely to get smaller over the next 12 - 24 months and become a very small minority.

Evans estimates the following smartphone app usage for Facebook (based on Q3 data above):  

  • 140 million people globally using the iPhone app
  • 176 million using the Android app 

Below is a chart from Evans showing the relative growth of Facebook access on the various mobile platforms from September 2011 to September 2012: 

Screen Shot 2013-01-07 at 12.30.12 PM

Assuming these numbers are accurate you can see the reversal of positions of the iPhone and Android since last year, which makes sense. However the larger point is that a majority of Facebook users now access the site via mobile. 

Facebook has argued that mobile is ultimately a much larger revenue opportunity than the PC. The following verbatim Facebook remarks come from the Q3 earnings call transcript: 

  • Mobile will give us the opportunity to reach way more people than desktop . . .
  • Somebody who uses only our desktop product has only a 40% likelihood of using Facebook on a given day, but someone who uses mobile has a 70% likelihood of using Facebook on a given day . . .
  • After just six months of ramping up our mobile ad business, we’re already at a point where 14% of our ad revenue this quarter is from mobile. That’s about $150 million . . .

Social and paid-search ad platform Kenshoo came out with data today that argue the percentage of ad revenue coming from mobile is now up to 20.3%. 

Facebook is expected to generate roughly $1.5 billion in overall revenue in Q4. Not all of it is ad revenue, however. Roughly $260 or so million would be attributable to mobile if the 20.3% figure holds and the forecast is correct. 

Google sees lower CPC prices on mobile paid search ads but better performance on mobile devices vs. the PC. However Facebook is experiencing the opposite phenomenon, according to Kenshoo. It sees higher mobile prices but lower engagement vs. the desktop.