This Week in Tech:
Facebook’s Successful Q3 Reports $7 Billion in Revenue, up 16% YoY – Expects Growth to Slow in 2017
While Twitter faces layoffs, Facebook continues to see growth. The social media giant posted earnings of $7 billion in Q3 from a 16% year-over-year growth. Daily active users now total 1.13 billion, also up 17% year-over-year with 1.66 billion mobile monthly active users Facebook’s success is largely due to mobile which comprises 84% of ad revenue. Overall profit reported was $2.4 billion for $26.1 billion in cash, equivalents and securities.
Despite the good news, Facebook has told investors it expects “to see ad revenue growth rates come down meaningfully.” in 2017. Facebook has reached the maximum number of ads it can show in the newsfeed, and it will slow down until this problem is solved. This, along with the CFO stating they expect 2017 to be an aggressive investment year, caused the stock to fall 9 percent in after-hours trading.
Fitbit Stock Falls 30% and GoPro Falls 6% This Week Just Before Holidays
The Wearables market took a hit this week with Fitbit stock falling 30% on Wednesday opening at $9.03 compared to $12.81 the previous day. Despite wearables being popular as a holiday gift, Fitbit has said it’s not going to have the huge quarter that investors expected. Fitbit expects to sell about $200 million worth of fewer devices due to lower demand and production issues with Flex 2. The latest device has limited availability meanwhile the older devices are seeing softer sales.
Yelp Lays Off 175 Employees to Scale Back International Investment
Yelp is stopping international sales and marketing and cutting up to 175 jobs due to stagnant foreign account growth. As of Q3, only one percent of Yelp’s revenue is from international listings. The company’s domestic business is still strong with mobile driving Yelp’s business. Mobile app usage grew 24% year-over-year and claims 70 percent of the company’s total page views.
Android Shipments Grow 6 Percent to Capture Unprecedented 88 Percent of Global Smartphone Shipments in Q3 2016
Global smartphone shipments reached 375 million units in the third quarter of 2016 with Android claiming 88 percent of the marketshare compared to iOS’s 12 percent. The emerging markets have been supporting Android, especially in China and Africa. Meanwhile, Microsoft Windows and Blackberry have dwindled to be nearly non-existent due to lack of developer support. Woody Oh, Director at Strategy Analytics, stated, “Android’s leadership of the global smartphone market looks unassailable at the moment. Its low-cost services and user-friendly software remain attractive to hardware makers, operators and consumers worldwide.” However, several challenges remain for Google. The Android platform is getting”place.”