Facebook Incorporated

Facebook Incorporated

Basic Information

Facebook Inc is a for profit corporate that operates an online social media and social networking website with global coverage. Facebook’s products are free to use and are available on the web, as well as on mobile platforms. Facebook provides a service that enables people connect with one another over the internet through mobile devices, personal computers and other internet enabled devices. Facebook was founded in February 2004 by then Harvard College student Mark Zukerberg and his friends Dustin Moskovitz, Andrew McCollum, Chris R. Hughes, and Eduardo P. Saverin. Facebook Inc is headquartered in Menlo Park, California, USA. In February 2012, about eight years after its launch, Facebook held its initial public offering (IPO). It began the sale of stocks to the public three months later reaching a market capitalization of $104 billion. On July 2015, Facebook Inc was recorded as the fastest company in the Standard & Poor’s 500 Index to achieve a market capitalization of $250 billion. Facebook currently has more than 2 billion active users every month and is ranked as the most popular social networking website globally based on the number of active users. Although, global in coverage, the bulk of Facebook’s revenue is generated from outside the United States, with a huge portion of the company’s international business coming in from Australia, Canada, China and Western Europe. Facebook has offices and data centers in major cities of the world and employs more than 17,000 people.

Products & Services

Facebook Inc’s main products include Facebook App, Instagram, Messenger, Whatsapp and Oculus Rift.

Facebook App allows people to make connections, discover, share and communicate with one another on mobile devices and PCs. Instagram enables people to take photographs or videos, customize them and share them with friends and family in a feed or send them directly as direct messages. Messenger provides a vibrant and easy way to communicate with people and businesses across a variety of devices and platforms. WhatsApp Messenger is an instant messaging and files sharing application that is used by people all over the world on a variety of platforms and devices. The Oculus virtual reality technology and content platform powers products that allow people to enter an interactive environment to play games, consume content, and make connections.

Facebook also sells advert placements to marketers and businesses. These adverts enable businesses to reach a wide selection of people based on certain specific factors such as age, location, sex, preference and behavior.

Facebook Inc is well known for its acquisition strategy in adding complementary companies and expert staff to its already robust collection. Although the company has slowed down its acquisition pace, it did acquire 3 different companies in 2016. Facebook Inc acquired Nascent Objects, a small startup in California that produces modular electronics system that people can use to build their own gadgets. Facebook also acquired FacioMetrics, a facial recognition startup to enhance its photo and video special effects. In 2016 also, Facebook Inc acquired CrowdTangle, a social analytics company.

Major Competitors

Facebook’s area of interest covers social media and networking, Video, Virtual Reality, Artificial Intelligence, Online advertisements and Internet & mobile communications. Companies with interest in these areas include Apple Inc., Classmates, Inc., Google LLC, IAC/InterActiveCorp., LinkedIn Corporation., Microsoft Corporation., Twitter, Inc., Yelp Inc. and YouTube LLC.

Key Executives

Mark Elliot Zuckerberg, Chairman & Chief Executive Officer.

Sheryl Kara Sandberg, Chief Operating Officer & Director

Marc Lowell Andreessen, Independent Director

Michael Todd Schroepfer, Chief Technology Officer

John Alexander Lagerling, Vice President-Business Development

Financials

Facebook Inc, with its global sales force, earns more than 95% of its total revenue from the sale of advert placements to marketers and businesses. This brought in an estimated $26 billion in 2016, although the company spent about $310 million on advertising and promotional expenditure in 2016.

Over the past few years, Facebook has experienced very speedy growth which enabled the company to dominate the social networking industry as the most used site of its kind all over the world. In 2016 fiscal year, Facebook’s revenue was $26.89 billion. A 57% increase from the previous year.

Facebook’s net income for 2016 fiscal year was $10.22 billion, a huge leap from #3.6 billion of 2015 fiscal year. The company’s capital expenditure for 2016 fiscal year was $4.49 billion. Facebook ended 2016 fiscal year with more than $16 billion in cash, a surplus of cash in hand from operations.

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