Facebook’s Results Affirm Leadership

Wide-moat

Growth in Facebook’s MAUs and daily average users, or DAUs, continued to attract advertising dollars and generated ad revenue of $7.9 billion during the quarter, up 51% from the prior year. While Facebook is lowering ad inventory on its own properties later this year, for the time being, demand has remained strong, which has pushed up ad prices, as indicated by the 28% year-over-year increase in average revenue per user. In addition, the firm has successfully added Snapchat-like features, such as Stories, to Instagram, driving the app’s users and user monetization higher. Overall, with more users and user engagement, Facebook continues to not only strengthen its network, but also possibly the value of its intangible assets stemming from user data.

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