- Silicon Valley's 19 Coolest Places to Work
- Is Windows 8 Development Worth the Trouble?
- 8 Books Every IT Leader Should Read This Year
- 10 Hot Hadoop Startups to Watch
IDG News Service - Facebook, under pressure to cheer up its disappointed investors, posted revenue growth of more than 30 percent on Tuesday, beating Wall Street expectations, but it also recorded a loss.
Facebook's revenue for the third quarter, ended Sept. 30, rose 32 percent to US$1.26 billion, compared with $954 million in the third quarter last year, and exceeded the $1.23 billion that financial analysts had expected, according to a poll by Thomson Reuters.
Its net loss was $59 million, or $0.02 per share, compared to net income of $227 million, or $0.10 per share, reported last year.
On a pro forma basis, excluding items such as stock-based compensation, Facebook reported earnings of $0.12 per share, beating expectations by a penny.
Investors welcomed the news, sending Facebook's stock higher in the after-hours markets. Its shares on the Nasdaq were trading at $21.95 at the time of this report, up 12.6 percent from the close of regular trading, according to Capital IQ.
That's only slightly more than half the value of its shares when Facebook held its public offering in May. The poor performance has been blamed on concerns that Facebook can't generate as much advertising revenue from mobile users.
CEO Mark Zuckerberg tried to quell those concerns Tuesday. During a conference call to discuss the results, he expressed his conviction that mobile devices represent a big opportunity for Facebook to expand its user engagement and ad revenue.
"Our opportunity on mobile is the most misunderstood aspect of Facebook today," he said.
Users who access Facebook from smartphones and other mobile devices are more engaged than those who access the service from PCs, he said. Mobile users are more likely to access Facebook on any given day than PC users, he said.
Critics have said Facebook needs to provide a better mobile experience for users and advertisers, and Zuckerberg admitted in September that Facebook's mobile strategy focused too much on HTML5 instead of on building native applications.
On Tuesday, he acknowledged that improvements in the mobile products were needed. "Over the past year, a lot of people gave us feedback that our mobile apps were too slow," he said.
The company took several steps to improve its mobile experience during the quarter, including revamping its iOS application and releasing new development tools for iOS and Android. It also closed its acquisition of the popular mobile photo-sharing app Instagram.
An upgrade to the Android application is in the works. Plus, the stand-alone Facebook Messenger mobile application, which lets users communicate both with Facebook and non-Facebook contacts through site notifications and regular text messages, also was upgraded for iOS and Android.
Zuckerberg said he thinks the company will eventually generate more revenue from mobile than desktop usage, in particular because mobile ads are integrated more "organically" into the Facebook experience.
Development groups at the company have been put in charge of building revenue-generating elements for their products, which is already yielding good results, according to Zuckerberg.