Facebook's 2020 Advertising Revenue Increased 21% Year-on-year To $84.2 Billion

Recently, social media giant Facebook announced its fourth quarter 2020 revenue report. The report shows that in the fourth quarter of 2020, Facebook's profits increased by 53% to a record $11.2 billion; revenue increased by 33% to approximately $28.1 billion.

At the same time, Facebook's total revenue in 2020 increased by 22% year-on-year to US$86 billion, of which revenue from the advertising business increased by 21% to US$84.2 billion. This shows that most of Facebook's revenue comes from Advertising space for sale.

Facebook's strong revenue growth shows that marketers increase ad spending on social networks such as Instagram, especially during the holidays, to attract consumers into stores.

In addition to the continued growth in advertising revenue, Facebook's "other" business revenue, including the Oculus virtual reality (VR) unit and the Facebook classified advertising market, has also grown significantly, increasing 156% year-on-year to 885 million in the fourth quarter of 2020. Dollar.

In terms of user data, Facebook’s monthly active users (MAU) in the fourth quarter were 2.8 billion, a year-on-year increase of 12%; the number of daily active users was 1.84 billion, a year-on-year increase of 11%. The number of users of Facebook's applications including Instagram, WhatsApp, and Messenger increased by 10% in the fourth quarter of 2020, reaching 2.6 billion.

The epidemic has undoubtedly played a certain role in promoting the development of Facebook. Facebook highlighted two major economic trends that will boost its revenue this year: the continued shift from brick-and-mortar retail to online e-commerce and the shift in consumer demand from services to products. But if any of these trends weaken or reverse, it will become an obstacle to Facebook's advertising revenue growth.

Therefore, although Facebook's various data performed well in 2020, the company is still cautious about its performance development in 2021 and predicts that Facebook will face greater "advertising headwinds" in 2021.

Facebook said that "advertising headwinds" may also come from the impact of Apple's new IDFA (identifier for advertisers) regulations and the evolving privacy policy. The IDFA identifier can be used to track the online activities of Apple users and serve personalized ads based on this.

Facebook expects Apple's changes to IDFA terms to begin having an impact by the end of the first quarter. After the Apple system is updated, when an application requests access to the company's built-in IDFA permissions on its device, Apple users will receive a pop-up box to choose whether to allow merchants to use this permission. Apple said that the reason for taking this step is to respect the users' rights. privacy.

However, if you want to know whether Facebook's subsequent advertising revenue and the traffic channels of small and medium-sized sellers will be greatly affected, you may have to wait until Apple's iOS14 updated version is officially launched.