Facebook / Google Financial Comparison
- 1. IS FACEBOOK THE NEXT GOOGLE? A financial analysis Feb. 8, 2013
- 2. IS FB THE NEXT GOOG? • Since going public, Facebook has remained in the spotlight when it comes to their financials • Many analysts have hypothesized if Facebook could become the next Google, implying soaring revenues and profits • Now that FB has been public for almost a year, I thought I would see how their financials stack up
- 3. QUARTERLY REVENUE (IN MILLIONS) $16,000.00 $14,000.00 $12,000.00 $10,000.00 FB Revenue $8,000.00 Goog Revenue $6,000.00 $4,000.00 $2,000.00 $- 2011-12 2012-03 2012-06 2012-09 2012-12 Data Source: MorningStar.com
- 4. REVENUE LONGSHOT • Although it appears to be slowly increasing, Facebook remains far behind Google when it comes to quarterly revenue • Google generated 734% more revenue in Q4 than Facebook But what about profits…
- 5. QUARTERLY PROFITS (IN MILLIONS) $3,000.00 $2,500.00 $2,000.00 $1,500.00 FB Net income Goog Net Income $1,000.00 $500.00 $- 2011-12 2012-03 2012-06 2012-09 2012-12 $(500.00) Data Source: MorningStar.com
- 6. PROFITS ARE ALSO GREATLY UNBALANCED • From a profitability perspective, the companies are further apart • Google generated 4409% more net income than Facbeook in Q4 Image source: http://updates.clltopics.org/2273-site-news-june-19th-workshop-columbia-maryland
- 7. IN SUMMARY • Despite being similar in size, Facebook is unable to come close to Google in terms of revenue or profit • Q4 Revenue: Google $13.2B – Facebook $1.6B • Q4 Net Income: Google $2.9B – Facebook $64mm • To narrow the gap they will have to continue adding users, but more importantly find out how to more efficiently advertise to their existing users • Facebook Exchange could be a step in the right direction, but we’ll see how much volume it can generate