Connect with us

Hi, what are you looking for?

Jewish Business News


Mark Zuckerberg Can Afford a ‘Spend to Win’ Strategy for Facebook

Mark Zuckerberg china

Facebook reported successful quarterly earnings, but like many large companies, it might have to keep spending to win. After growth companies pass the first phase of a meteoric rise in stock price and popularity, there is a tendency to stall and settle into more mature and gradual growth with muted expectations. CEO Mark Zuckerberg seems to want none of that, but is willing to raise capital expenditures dramatically to fuel growth, something that Facebook seems to be in a position to do.

Advertising revenue, particularly from mobile, was strong, and showed a 49% increase year over year. Mobile now makes up 69% of advertising revenue. Earnings per share increased, but still fell short of Wall Street’s estimates by 8 cents a share. Operating margin fell from 44% to 29%, but management explained that new investments in Atlas, Live Rail and Ad Tech were going to see payoffs in time, according to ValueWalk.

In fact, some may balk at Facebook’s capital expenditures increase, that rose from 16% to 29% in the fourth quarter, but when one considers much of this was to cover the $22 billion purchase of WhatsApp, this is a sound investment rather than an expense. Mark Zuckerberg needs to figure out how to get those using the social network platform to use it on a daily basis and to squeeze more money out of each user. If he has to break the piggy bank to do it, the piggy bank could be broken by more capable hands.

Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.



You May Also Like

World News

In the 15th Nov 2015 edition of Israel’s good news, the highlights include:   ·         A new Israeli treatment brings hope to relapsed leukemia...


The contract signed between the Israeli government and Pfizer shows clearly and unequivocally that this is a clinical study on humans - The agreement...


Now Platika joins and elite club of $10 billion plus Israeli firms.


After two decades without a rating system in Israel, at the end of 2012 an international tender for hotel rating was published.  Invited to place bids...

500 - Internal server error.

500 - Internal server error.

There is a problem with the resource you are looking for, and it cannot be displayed.