Facebook Q1 revenue grows 72% on rising mobile ads

Social-networking giant Facebook on Wednesday announced better-than-expected rise in its overall first-quarter revenue, thanks to an impressive growth in its mobile advertising business.

The company announced that its overall revenue increased 72 per cent year-on-year to $2.5 billion in the January-March quarter of 2014. Analysts polled by Thomson Reuters had the company's quarterly revenue at $2.36 billion.

Mobile adverts represented 59 per cent of the social-networking giant's total ad revenue in the first quarter of this year, well above 30 per cent in the corresponding quarter of the previous year.

Ronald Josey, an analyst with JMP Securities, said, "They've got the right products for what advertisers are looking for and that's manifesting itself in the results you're seeing."

Facebook's newsfeed ads, which are tailor-made for the smaller screens of mobile devices like smartphones, inject paid marketing messages direct into users' stream of news & content. These ads have, in particular, provided a big boost to the company's revenue growth.

Facebook shares gained nearly 3 per cent to $63.05 apiece in after-hours trading on Wednesday. The stock has more than doubled in the past twelve months but it is still 13 per cent down from its 52-week high of $72.59 that it hit in mid-March this year.