Facebook Inc, the world’s most popular social-networking service, is likely to generate revenue of about US$2 billion this year, a larger sum than earlier projected, according to three people familiar with the matter.
Sales will more than double from last year, said the people, who declined to be identified because the privately held company doesn’t disclose revenue. Facebook had US$700 million to US$800 million in sales last year, and the figure for this year was previously expected to be closer to US$1.5 billion, according to two other people familiar with the matter earlier this year.
Facebook’s more than half a billion users have made it an attractive target for advertisers, including Coca-Cola Co, JPMorgan Chase & Co and Adidas AG. In October, Facebook surpassed Yahoo when ranked by the number of global users, making it No. 3 behind Google Inc and Microsoft Corp, according to ComScore Inc, a research firm in Reston, Virginia.
“The love affair of consumers with social networks is an abiding one,” said Karsten Weide, an analyst at IDC in San Mateo, California. “All the big brands are there.”
Jonathan Thaw, a spokesman for California-based Facebook, declined to comment.
Facebook, founded in 2004, would reach US$2 billion in revenue faster than Yahoo and at almost the same pace as Google.
Yahoo, founded in 1994, posted revenue of US$1.6 billion in 2003 and US$3.6 billion in 2004. Google, founded in 1998, reached US$1.5 billion in 2003 and then US$3.2 billion in 2004.
Mark Zuckerberg, the founder and chief executive officer of Facebook, was named Time magazine’s “Person of the Year” on Wednesday. The publication noted his role in “creating a new system of exchanging information” and “changing how we all live our lives.”
Facebook has maintained ad prices, even as user growth has created a surge of space for commercial messages, the company said in August. Facebook also makes money from a credits program, which lets people buy virtual items in online games.
The company is making gains in so-called display ads — the banners, videos and other graphical promotions that appear on Web sites. It may grab about 9.4 percent of that market in the US this year, up from 6.6 percent last year, according to EMarketer Inc in New York.
Yahoo, which leads the market, will have about 16.2 percent, down from 16.5 percent, the firm estimates. Google, which is stronger in Internet-search ads, may take 6.7 percent, up from 4.7 percent.
Facebook’s growth is also attracting investor interest. The company has a valuation of US$43.1 billion, according to SharesPost Inc, an exchange for privately held stocks. That’s up more than 60 percent from three months ago and almost quadruple the level in March.
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