Facebook Inc is now the second-biggest seller of online advertisements after Google Inc, researcher EMarketer Inc said.
The world’s largest social-networking service is on track to take in US$3.17 billion, or 7.4 percent, of US digital-ad spending this year, while Google will account for US$17 billion, or 40 percent, EMarketer said in a blog post yesterday.
Facebook was fourth behind Google, Yahoo and Microsoft Corp last year.
Facebook is stepping up its ad efforts, generating half of revenue from mobile and testing video promotions that play automatically in users’ news feeds. Instagram, which Facebook bought for more than US$700 million last year, is also rolling out ads on its photo-sharing service. Facebook and its rivals are battling for a share of a digital-ad market that is projected to grow 25 percent to US$53.4 billion in the US in 2015.
“Facebook and Google are both major drivers and recipients of this growing market, domestically and internationally,” EMarketer said.
Both companies are also the top-two ad publishers globally, the researcher said.
Mobile ad spending will account for 23 percent of digital-ad spending this year, up from 12 percent last year, EMarketer said.
In related news, Facebook and chairman and CEO Mark Zuckerberg are selling a combined 70 million shares of Class A stock, as the company prepares to join the Standard & Poor’s 500 index.
The offering includes more than 41 million shares from Zuckerberg, who will also buy Class B shares that carry more voting weight.
After a premarket stock dip of more than 4 percent on the news, Facebook’s stock recovered somewhat and was down less than 1 percent in afternoon trading on Thursday.
The company said that the Class A shares will be offered mainly to index funds whose portfolios are based on stocks included in the index. The S&P 500 was set to add Facebook after markets closed yesterday.
At Wednesday’s closing price of US$55.57 per share, the total value of the offering, not counting expenses, would be about US$3.89 billion. Zuckerberg’s offering of 41.3 million shares would generate about US$2.3 billion based on Wednesday’s close, not counting expenses.
The company said Zuckerberg will use most of the proceeds from his sale of Class A shares to pay taxes he will incur in connection with exercising an option to buy 60 million shares of Class B stock. He is also using part of it for charitable contributions.
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