Facebook revenues 'hit $1.2 billion in nine months'
2010 financials leaked
Facebook pulled in $1.2 billion in revenue over the first nine months of 2010, according to a report citing documents distributed by Goldman Sachs, which is offering Facebook equity to some of its wealthiest clients.
Facebook's net income during the first nine months of 2010 reached $355 million, Reuters reports. Goldman values Facebook at $50 billion, and it's offering as much as $1.5 billion in Facebook equity.
An earlier report from The Wall Street Journal said that 2010 Facebook financials were not disclosed to at least one Goldman Sachs customer. This report pegged the social networking's outfits 2009 revenues at $777 million and net income at $200 million.
Facebook did not immediately respond to a request for comment.
The social network now boasts 500 million users worldwide, and according to Facebook boss Mark Zuckerberg, half of those 500 million log in every day. What's more, these people are voluntarily giving the service scads of info not only about themselves but about their friends, family, and acquaintances. It's potentially the ideal platform for targeted advertising. And that's why Google is so jealous. ®
Net income of $200 million?! Wow! They're rich!!!
So a company with a net income of $200 million is supposedly worth $50 billion? What year is this, 1999?!
Google has a Net that's about 30x greater than Facebook's. Yet, Google is only valued at about 4x more than Facebook. Absolute insanity.
Wow what a surprise: ANOTHER investment SCAM by Government Sachs in the works?
I'm still confused: how the hell is this disgusting, truly *evil*, parasite corporation is not only allowed to roam free after all its previous criminal activities but even organize new ones?
Just to state the obvious, since no-one's done it yet. If these figures are to be believed, then:
- FB is pulling in about $3.20/year advertising revenue per punter
- maybe only half of these punters are in geographic areas that are of interest to advertisers, so these ones make about $6/year
- each of these punters is clicking through once every 2 or 3 weeks, assuming 30c per click-through
- each punter costs FB $2.25/year. This seems a bit low. I guess a lot of people don't use the servers much.
- a valuation of 50B, with an annual net income of 500M, might give a P/E of about 100. According to Wikipedia, "Since 1900, the average P/E ratio for the S&P 500 index has ranged from 4.78 in Dec 1920 to 44.20 in Dec 1999, with an average around 15."
- new investors have to expect FB's income to increase by at least 100/15 = 6.7 to make sense of a $50B valuation
- I can't see FB getting a lot more than 500M users, so each user will have to generate about $21.50 in revenue, instead of $3.20. Again, assuming that only half of users are of interest to advertisers, that comes to $43 per interesting user
- So, either (1) each interesting user has to increase their click-through rate from 20/year to 134/year,
- or, (2) advertisers have to be willing to increase their payment from 30c to $2.00 per click-through,
- or, (3) users must be willing to fund this valuation themselves, by paying an annual subscription of maybe $20.
Of these, (3) looks far and away the most likely. Still, I don't get it. Once FB starts charging everyone else will jump in with their own sites. Anyone who buys in at this price has to be a teensy bit dumb.