Why Facebook Is A Huge Is A Money Machine


The market is slowing understanding that Facebook Inc. is a way more interesting company than one may think: the latest earnings data have been really good


(original publishing date: 07/25/14)

You may not like social networks, you may laugh at the traders buying a social media company’s stocks on the market and you may even think that FB success is just a sign of another financial bubble, but you will have to acknowledge that Facebook had extremely good data for Q2.

Now, many readers show to have troubles at understanding how exactly Facebook makes money. It is actually very simple.

Facebook Inc. makes its money on advertising and, as you can easily understand, an advertising machine (because that’s what we are talking about when we refer to Facebook) is as big as the number of people it can reach.

Apparently, this mechanism is working just great:

This growing number of people represents a higher attractiveness for companies who want to advertise themselves on Facebook, therefore…:

And the best number for the stock market is, as always, EPS:

You may not like Facebook, but there are companies out of the social media business who would do anything to have such great numbers.


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