Facebook to double revenue to $4.27 billion, 89% is from ads

Summary:In 2011, Facebook's advertising revenue will be $3.8 billion out of a total $4.27 billion, or 89 percent.

Facebook's advertising revenue is estimated to rise 104 percent this year to $3.8 billion. Total revenue, which includes advertising as well as Facebook Credits and other sources, is expected to reach $4.27 billion this year. This number is more than double the $2 billion Facebook is estimated to have earned in 2010.

The advertising number is actually a decrease from the last Facebook revenue estimate for 2011. In January, eMarketer forecast advertising revenues would reach $4.05 billion this year, meaning it has decreased its assessment by $250 million. Despite this, the market research company still expects the social networking giant to thrive.

"This slight revision downward for 2011 should not be taken as a sign that Facebook's overall business is losing momentum," Debra Aho Williamson, eMarketer principal analyst, said in a statement. "Facebook's revenue streams will continue to diversify, with ads representing a decreasing proportion of total revenue while other sources, such as Facebook Credits, will grow."

If we compare Facebook's advertising revenue for 2011 ($3.8 billion) to its total revenue ($4.27 billion), we see that the former makes up 89 percent of the latter. This number is down from 95 percent in 2009. This means that although the social network has managed to double its advertising intake, it is also diversifying its revenue streams and adding dollars through other means, like Facebook Credits.

In the US alone, Facebook advertising revenues will surpass $2 billion this year, accounting for just over half the worldwide total. While this stream will continue to grow rapidly, overseas advertising dollars are estimated to represent 50 percent of Facebook advertising revenue in 2012, and a slight majority by 2013.

eMarketer makes its Facebook revenue estimates based on consumer usage, marketer usage, as well as ad pricing and impressions on Facebook. The firm also says it takes into account revenue estimates from research firms and interviews with industry executives.

See also:

Topics: Social Enterprise

About

Emil is a freelance journalist writing for CNET and ZDNet. Over the years, he has covered the tech industry for multiple publications, including Ars Technica, Neowin, and TechSpot.

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